Cpa Ethics and Governance Exam Index

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CPA Ethics and Governance Exam Index
Comparative Corporate Governance Structures (Murdoch University)
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Topic Module Page Comments

A
Linked to Mod 2, 1.intigrity, 2. Objectivity, 3.Prof competience and due care, 4. Prof
A code of ethics for members 1 15 behaviour, 5. Confidentiality
A distinctive ethos or culture 1 16 Consists of values, norms and symbols of profession. Can also be called culture.
A high degree of autonomy and independence 1 14 Ability regulate itself
A systematic body of theory and knowledge 1 12 Body of knowledge- *Theory construction *Systematic research
Two-strikes rule-shareholders spill the whole board but KMP are not eligible to vote.
AASB (Australian Accounting Standards Board) (2010) 4 214 KMP are- planning authority, controlling activities of entity directly or indirecty
AASB 124 Related Party Disclosures 4 214 Defined 'KMP' ('Two-strike' rule)
Abbott (2014) 1 6 Professions never had a public interest or service ideal
1.Predatory Pricing 2.Loss leading 3.ACCC competition and consumer Act
Abuse of market power 4 250 S46
ACARA 2014 5 325 sustainability
Apply for permission for anti-competitive behaviors. Approval on the basis of 'the
ACCC 4 257 public interest'.
Undertakes a number of functions involving regulation, legislation development,
ACCC (Australian Competition and Consumer Commission) 4 251 competition law education, prosecution and administrative decision-making.
Can grant immunity from prosecution in return for blowing the whistle on the cartel
ACCC Immunity Policy for Cartel Conduct 4 253 conduct.
ACCC v. Cabcharge Australia Ltd (2010) FCA 1261 4 251 Market power misuse
ACCC v. Metcash Trading Ltd (2011) FCAFC 151 4 252 M&A
ACCC v. Midland Brick Co Pty Ltd (2004) FCA 693 (31 May 2004) 4 254 Price-fixing
The duty to provide a report, or an account, of the actions and decisions made in
regard to those areas of activity for which an organisation is deemded to be
Accountability (Difinition) 5 324 responsible.
Accountant (business) 2 74
Accountant (public practice) 2 73 Independence
Accountant Roles in private business 1 27 Table 1.5 - Type of roles
Accountant roles performed is SME 1 28 End to end accounting and finance function
Accountant roles within public practice (Table 1.4) 1 26 -
Accountants (conformance vs. performance) 3 140 Accountant spend too much time on conformance and compliance based work.
Accountants and effective governance 3 140 -
Accountants as external advisers to SMEs 1 26 CPA Australia (2005)
Accountants as members of a profession 1 3 -
Accountants employed in the large business environment 1 27 -
Accounting for the levels of emissions 5 358 Scope 1, Scope 2, Scope 3
Accounting in small and medium enterprises (SMEs) 1 28 -
Accounting Professional and Ethical Standards Board (APESB) 1 18 Background
Accounting roles, activities and relationships 1 24 -
...typically shaped by factors such as new and evolving technologies, changing market
conditions, legislative and regulatory developments, and the needs of a diverse range
of parties engaged in making resource allocation decisions and accountability
Accounting work environment 2 48 evaluations
Accounting work environments 1 25 Table 1.2 - Examples of accounting work environments
Ackman 2002 4 286 Whistleblower protection. Example 4.18
Act beyond their power but innocently (Directors) 3 121 Example 3.2 Advance bank
Act in the corporation's best interests 3 120 -
Acting with sufficient expertise (s. 230) 2 85 -
Adams 2013 5 341 Integrated reporting
Adaptiation 5 355 adapting the effects of climate change
Adolf Berle 5 306 who embraced the shareholder primacy perspective.
Advance Bank Australia 3 121 Directors act beyond their power, however innocently
Advocacy threat 2 69 -
Agency costs 3 133 Three types - Monitoring costs, bonding costs, costs relating to residual loss
Agency costs (Examples) 3 134 Example 3.4 - Agency costs
Agency costs can arise as a result of: 3 133 information asymmetry, poor communication & understanding, self-interest, illegal
Agency theory 3 132 views CG through the relationship between agents and principals.
Agency theory (two key assumptions) 3 132 self-interest / in a position of power
Agent 3 138 Those who assumes responsibilities to look after = agents
Agent of the board 3 129 managers are the agent of the board
Agreements between competitors—cartel conduct 4 253 Horizontal agreement/ Collusive behaviour/ Cartel conduct/ Cartel provision
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AICD (Australian Institute of Company Directors) (2010) 4 217 Adopting diversity
AICD Report (2010) 4 218 Refer to page for key points of NAB's diversity approach
Alan Fels (Prof. Fels 1999) 4 241 relevant competition and consumer law and page 318 "compliance programs"
Allan, G. (2006) 1 11 Professions - question the independence of Anderson
Allocating customers, suppliers or territories (Cartel conduct) 4 253 Also known as 'market sharing', consumers are not offered choise
North Europe: top tier-supervisory board + second tier-mangement board (strong

Alternative board structures and relationships 3 131 employee representation) // In Japan have banks on board to get stable financing
Alternative international approaches to governance 3 161 Market-based systems vs. Relationship-based systems
Altman and Hotchkiss (2006） 4 208 Management inadequancies lead to corporate failure
Describes action that brings no benefit to oneself, and may even at one's own
expense. This view then aligns with the concept that professional accountants act in
Altruism 1 3 the public interest
American Accounting Association model 2 108 7 steps
America's most overpaid CEOs (Example 4.3 ) 4 223 Cisco. John Chambers, CEO, highest paid
An asset by any other name 2 109 Example 2.21
companies are run for shareholders, being the owners of the companies, with the duty
Anglo-American legal approach 3 174 to stakeholders being a derivative of this primary duty
The underlying rule: The key duty of directors is to act for proper purposes and to act
Anglo-American model 3 174 in good faith in the interests of the company as a whole.
rights of individuals, contracts, negligence, property; and ownership rights,'common
Anglo-American system (Legal) (community wide laws) 4 238 law jurisdictions' refer page for countries
Anti-competitive Behaviour (automatically illegal) 4 253 dealt with civil basis.
CPA Australia to investigate complaints against member under its investigation,
APES 110 2 60 discipline and appeals procedure.
Quality assurance process. 1.Leadership respobsibilities for quality within the firm.
2.Ethical requirements. 3.Acceptance and continuance of client relationships and
specific engagements. 4. Human resources. 5.Engagement Performance.
APES 320 Quality control of firm 1 19 6.Monitoring.
APES GN 40 Ethical Conflicts in the Workplace 2 106 APES GN 40 Ethical Conflicts in the Workplace
APESB 2 60 Accounting Professional Ethical Standards Board
was the result of an initiative of CPA Australia and the Insititute of Chartered
APESB (Accounting Professional and Ethical Standards Board) 1 18 Accountants in Australia (ICAA) - 4 Nov 2005
APESB (Fulfils its role by) 1 18 See page for list
APESB (Technical board) 1 18 Include two members of CPA Australia
APESB Code of ethics 2 60 -
Single most important attribute of a profession. Diagnose and solve complex,
Application of professional judgment 1 16 unstructured valus based problem. Becker-1982
Applying ethics 2 51 -
Appointment 4 211 Board appointment and cessation (ending, termination)
Approaches to consumer protection (misleading conduct) 4 259 Hong Kong, Malaysia, Japan and Australia
Approvals procedures 4 257 exception of anti competive conduct. E.g. TAXI fare
Financial institutions will be informed of the reason behind a director's resignation by
APRA (Australian Prudential Regulation Authority) 4 212 APRA.
APRA (Australian Prudential Regulation Authority) (2015, p.1) 4 229 instituted a rigorous policy of RM in major financial institutions.
ARA Australian Reporting Award 5 353 Example of best practice and innovative reporting
Arbitrator (law as arbitrator) 4 249 clear rules that establish competition policies within the corporation.
Aronson 2002 2 95 Arthur Andersen
Aronson, B. 2002, ‘The Enron collapse and auditor independence:… 2 95 Case Study 2.2: Arthur Andersen
Arthur Andersen (Billing Enron) 4 227 Billed Enron 52 million for audit (25 mil audit & 27 non audit services)
Arthur Anderson 2 95 Case study 2.2
ASA 3 142 Australian Shareholders' Association: prevent smaller shareholders
ASC v. Gallagher (1993) ASCR 43 3 122 Directors' duty of care and diligence
ASIC (Australian Securities & Investments Commission) 3 150 List of traits of a sound regulatory system (as 'regulators' in CG)
ASIC (Australian Securities and Investments Commission) (2005)
Pecuniary penalty 4 240 Steve Vizard banned for 10 years and fined $390,000. Civil case
Assertiveness 1 38 self-confidence (a transferable skill)
Asset (Definition, from Conceptual Framework) 5 294 Limitations of traditional financial reporting
Assumption of agency theory 3 132
ASX CGC - Development 3 160 Development of CG in Australia
ASX CGC (2010) - Diversity 4 216 Promote Board diversity: particularty gender diversity
ASX CGC (2014) 4 220 Payments for past and future performance
ASX CGC (2014) - Summary 3 178 8 principles + 29 recommendations
ASX Continuous Disclosure Guide (ASX 2014) 3 123 Examples of information that can be market sensitive
for admission to S&P/ASX 300 Index, must have a remuneration committee
ASX Listing rule (ASX CGC 2019) 3 178 comprised solely of NEDs
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ASX Listing rule 14.4 4 212 Australia election exception for managing director
ASX Principle 2 - Structure the board to add value 3 180 -
A listed entity should disclose the names of directors considered by the board to be
independent; also a checklist of factors to consider when assessing a director's
ASX Principle 2.3 3 181 independence
Audit committee for listed co = 3 members + all NEDs + Majority INEDs + chaired by
ASX Principle 4 - Audit committee 3 183 INEDs
ASX Principle 7 - Risk management 3 178 Establish a sound RM framework, periodically review the effectiveness
Remuneration committee for listed co = 3 members + majority INEDs + chaired by
ASX Principle 8.1 - Remuneration committee 3 185 INEDs
8 traditional attributes of a profession. 1.Body of knowledge.2.Education
process.3.Ideal of service. 4.Autonomy and independence. 5.code of ethics. 6.Ethos
Attributes of the accounting profession 1 12 and culture. 7.Professional judgement. 8. Governing body.
became a Commonwealth statutory body (rather than remaining controlled by the
AUASB (Auditing and Assurance Standards Board) 3 161 major accounting bodies in Australia)
Audit and related regulation 4 227 -
Sarbanes-Oxley and FRC requeire at least one financial person on the board. But
Audit committe (ASX Principle 4) 3 183 ASX does not include this requirement.
Audit committee 3 147 Most important of the committees
Audit committee (Benefits) 3 148 List of benefits
To ensure independence, committee should comprise only non-executive members,
Audit committee (Independence) 3 147 with majority being independent.
Audit committee (Limitations) 3 148 List of limitations
Top 500 companies on ASX must have audit committee. Top 300 must conform to the
recommendations in the ASX principles. Under US Sarbanes-Oxley Act (US Congress
2002) all US listed companies must have an audit committee. (only independent
Audit committee (Mandatory) 3 183 director)
reviewing half year and full year financial statements prior to board approval (Percy
Audit committee (Responsibilities) 3 148 1995)
Audit committee (Sarbanes Oxley) 3 148 All members must be independent.
Sarbanes-Oxley Act requires audit committees to establish procedures for hearing
Audit committees 4 284 complaints.
is the term used when an audit is deficient due to negligence, incompetence or lack of
Audit failure-defination 3 150 independence by the auditor.
Auditing and Assurance Standards Board (AUASB) 1 18 AUASB+AASB report to FRC
Auditors (Internal and external) 3 150 -
Auditors key judgement 1 17 -
Auditors' report 4 226 addressed to the "intended users"
Australian Accounting Standards Board (AASB) 1 18 AUASB+AASB report to FRC
Australian Bureau of Statistics 3 195 2,200 ASX-listed vs. 2 M small business
crimal and civil. fines or jail sentence, in Aus, penalties for up to 10 years' jail for
Australian cartel provision 4 241 individuals or 10 Million or 10% group turnover
Australian Charities and Not-for-profit Commission (ACNC) 4 232 4000 charities failed to lodge financial reports.
Australian Competition and Consumer Act 4 243 Creates the Australian version of this new type of 'employee' protection
Australian Competition and Consumer Act 2010 (Cwlth) 4 249 Misuser of market power
Australian Corporations Act - Test for disclosure 3 123 Test of whether disclosure is required for market sensitive information
Australian Corporations Act - Whistleblowers' protection 4 284 who can be whistleblowrs and when "blow the wistle"
in 2011 Cwlth amended to provide for two stikes and re-election of all board members.
this rule was recommended in 2009 by Executive remuneration in Australia by the
Australian Corporations Act 2001 (Cwlth) - Two-strikes rule 4 214 productivity commission
Directors must give details of the entity's performance in relationto environmental
Australian Corporations Act s.299(1)(f) 5 331 regulaitons.
Australian Corporations Act s.299A(a) 5 331 Directors' report must include info about operations & business strateiges for future
Australian Shareholders' Assoication (ASA) 3 142 represent interests of smaller shareholders
A new best practice requirment to disclose any material exposures to sustainabilty
Australian Stock Exchange Corporate Governance Council 5 332 risks
Automatic disqualification 4 215 Dishonest = automatic disqualification. E.g
Automatically illegal (per se illegal) (anti-competitive behave) 4 253 -
Autonomous entity 3 136 consider the corporate to act as an autonomous entity (limited liability)
means, less detailed government regulation, setting your own rules, holding your own
Autonomy 1 9 member accountable. This reduce over time, and now we have co-regulation
describes the roles of 'the board', but 'the board is not in place to actually run the
AWA Ltd v. Daniels (1992) 10 ACLC933 3 130 business itself' (need to rely on management). Also "Rogers C J" .
AWB Ltd (Australian Wheat Board) 4 211 Lack of good CG
B
Bargaining process fails 4 247 Industrial action may occur.- go slows, work to rule, strikes
Barings bank 4 275 Example of Rogue Trading
Barraket et al. 2010 5 324 Social enterprises
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Baumhart cited in Mitchell 2003 2 44 Survey: what does ethics mean to you
BBC (British Broadcasting Commission) (2009) 4 251 Example 4.17: Intel fined Eur1.06 billion
Diversity: increase the number of women in senior executive positions to 50% within
BCA 2013 4 218 10 years
B-Corporations 5 324 In 2014, Natura from Brazil become the first publicly listed B-Corp.
argues that professional judgement is the single most important attribute that
Becker (1982) 1 16 differentiates professional from non-professionals
Benefit of applying ethical framework 2 44
Berle, Adolf (Professor) 5 306 Shareholder primacy perspective
Best practice corporate governance for addressing climate change 5 353
Junior accountants require higher levels of technical skills such as taxation and
Bhamornsiri & Guinn (2005) 1 38 financial reporting.
Bhopal, India, 1984 5 319 Environmental disasters
BHP Billiton 3 156 tension between the board and management - call for protocols
BHP Billiton 4 223 Example 4.4: BHP Billiton. Good CG. Severance payments
Bid-rigging (Cartel conduct) 4 253 Bid price should be confidential
Big Four accounting firms - Second-tier acconting firms - Small practies Table 1.3 - PWC, Deloitte, Ernst & Young and KPMG. 150 000 employees, Annual rev
and sole practitioners 1 25 20bil
Flora + fauna (meaning geological period), and ecosystems, is very challenging,
particularly as there is no generally accepted unit of measurement and reporting
Biodiversity reporting (challenging) 5 327 systems are often exploited.
BIS (Department for Business, Innovation & Skills) (2013) 4 222 Disclosure, transparency and remuneration
Blanthorne, Bhamornsiri & Guinn 2005 1 38 TSKE and SSKE - Career perspectives
Board chair 3 144 UK: independent board chiar // US: both CEO and board chair
ASX CGC (ASX Corporate Governance Council) (2010), CAMAC (Corporations and
Board diversity 4 216 Markets Committee) (2009)
Is the body that oversees the activities of an organisation- monitoring CEO,
Board of directors 3 130 formulating strategies, ensuring effective communication of the strategic plan.
Board's duties and functions - Summary 3 145 Tricker model & Henry Bosch
Board's primary functions 3 130 Figure 3.3
Board's reponsibility for sustainability 5 323
Board's role 3 130 The role of the board in modern companies
Board's role (vs. management) 3 130 to monitor the results of the business
Body Shop 5 348 Social audit, asked company employees
Bonding costs - borne by agent 3 133 Voluntary restrictions, restrictions on freedoms etc.
When directors resign, CG can be greatly enhanced if they follow Boash committee
Bosch 1995 4 213 recommendation - to make their concern known to shareholders or relevant regulator.
Bosch 1995, p9 3 145 Board's responsibilities and functions
Bowen C.J., Fisher J. and Fitzgerald J. 4 248 -
Brand and reputation 5 300 -
1.making anti-competitive agreements.(price fixing). 2.Hostile takeovers (focus on
protecting current management team rather than getting the best deal for
shareholders.) 3. Actions to destry majority voting power (where small minority gains
Breaches of directors duty 3 120 control of a corp)
Documents the loss of trust in the accounting profession during 2001 and 2002, in his
Brewster (2003) 1 34 book, How the Accounting Profession Forfeited a Public Trust
Bribery 4 273 -
Bridges Ventures (2012) 5 303 A spectrum of capital options
Arthur Andersen’s fall from grace is a sad tale of greed and
Brown, K. & Dugan, K. N. (2002) 2 95 miscues’
Brundtland Report (WCED 1987) 5 293 The needs of today vs. compromise future generations (also: Brundtland Report)
Society grants professions monopoly power as long as they use it in the public
Buckley (1978) 1 13 interest.
Business consumer protection 4 258 -
Business judgement rule 3 124 also: Safe harbour rule
Business judgments (Negligent) 3 183 diretors without appropriate skills takes plase in audit committee
Business leadership capabilities 1 37 -
Business Roundtable 3 159 Other international CG approach
By-Laws of CPA Australia 1 20 Profesional discipline
C
Cadbury (2000) 3 187 family-owned firms, their dinstinctives, CG issues and recommendations
Cadbury Committee, Cadbury Report 3 159 Development of CG in UK
describe its philosophy on CG. It's an extremely large Institutional shareholders
CalPERS (California Public Employees Retirement Scheme) (2011) 3 163 (pension funds).
CalPERS (Shareholder activism) 3 158 Institutional inveator (pension fund), one of the key drivers for better CG
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CAMAC Report (2009) 4 216 Board diversity. (Corporations and Markets Committee)
Capability considerations 1 37 -
Cap-and-trade system 5 356 Climate change accounting techniques
Capital cost lowering 5 302 Through at least three chanels
Carbon Disclosure Project (CDP) 5 342 Question 5.11: CDP for HSBC
Carbon pricing mechanism 5 334 was abolished effective 1 July 2014
basis of the amount of carbon dioxide released into
Carbon taxes 5 309 the atmosphere
four skill- *Technical skills, *business skills, *personal effectiveness skills. *
Career guidance system (CPA Australia) 1 37 Leadership skills.
Carnegie and Napier (2010) 1 6 Identified the ideals of accounting professionalism...
Re excessive remuneration - Bypassing this legislative approach, French corporations

have recently agreed to a new code which includes a vote on executive remuneration
Carnegy 2013 4 220 for shareholders at annual general meetings, similar to current pratice in the UK
Four different types, 1.output restrictions 2. allocating customers, suppliers or
Cartel behaviour 4 253 territories 3. bid-rigging 4. price fixing
Cartel conduct 4 253 Horizontal agreement/ Collusive behaviour/ Cartel conduct/ Cartel provision
fines or jail sentence, in Aus, penalties for up to 10 years' jail for individuals or 10
Cartel conduct (Criminal penalties) (price fixing agreement) 4 253 Million or 10% group turnover
Test or questions to ask - 1. Is there an arrangement. 2.Has it occur between
companies? 3. Is the desired outcome prohibited or will have a significant impact on
Cartel conduct test 4 253 competition.
Casual vacancy 4 211 it is common for board to use its powers to appoint a director immediately.
Categories of threats 2 69 Table 2.3
Caveat emptor to consumer protection 4 259 is a Latin term that means 'let the buyer beware'
CCG (Committee on Corporate Governance) (1998) Final Report known as 'supercode', was refined and improved over time to become Combined
('Hampel Report') 3 159 Code (FRC 2003)
Seeks information on the busniess risks and opportunities presented by climate
CDP Carbon Disclosure Project 5 342 change and GHG
CDSB (Climate Disclosure Standards Board) (2014) 5 343 A special project of CDP, develops a climate change reporting framework
CEC (Commission of European Communities) (2001) 5 324 defined 'CSR'
Example 3.3 Duty of care, reliance on others, delegation, information flow, financial
Centro case 3 125 competence
Centro case 4 227
Duty of care, reliance on others, delegation, information flow, financial competence.
Centro case (Key lessons) 3 125 Example 3.3
CEO's dural roles 3 145 Board member and CEO and potentially two identifiable agency relationships arise
CEO's role and responsibilities 3 131 -
CER - aim 5 333 is to reduce emissions while againg business competitiveness (CER 2019a)
CER (Clean Energy Regulator) (2013a) (2013b) 5 333 National Greenhouse and Energy Reporting Act
Certificate of Public Practice 1 12 public trust
CFACG (1992) 3 133 See "Sir Adrian Cadbury (CFACG 1992))"
CFACG (1992, para. 2.5) 3 138 Defined a framework of 'corporate governance'
'Chain of greed' report 5 300 Report into Walmarts worker exploitation in the US ('Chain of Greed' report)
Chambers 1973 1 34 Creative accounting
Characteristics needed for success 2 49 the accounting work environment
Charities and not-for-profit sector (fraud) 4 232 ACNC
Chemical Formulators Pty Ltd (2012) 4 256 Reseale price maintenance
Chernobyl, Ukraine, 1986 5 319 Environmental disasters
Child labour (Social sustainability issues) 5 321 estimated 215 Mil child labours
Large firms who may have staff working for both the target and the acquirer will need
to establish special internal information restriction protocols to stop information flows
Chinese walls 4 269 that breach confidences
Cho, E. H. et. al. (2012) 5 300 report into Walmarts worker exploitation in the US ('Chain of Greed' report)
Involves the placing of buy and/or sell order for shares with the object of artificially
increasing the market turnover. This increased activity will stimulate market interest
Churning (Market manipulation) 4 271 and often will be successful in creating an activity-driven price surges.
CIMA (Chartered Institute of M Accountants) (2014) 5 341 Natural capital accounting
Circular relationship 3 165 France - companies own one another's shares in a circular relationship
Cisco Systems 4 223 "The most overpaid US CEOs" John Chambers, CEO, highest paid
proof based on the balance of probabilities, Pecuniary, payable to the state. Results
Civil penalty (Civil case, pecuriary penalty) 4 239 from a civil penalty. Focus on redress (compensation)
Strategy without accountability = recklessness; accountability without strategy =
Clarke (2016) 3 139 paralysis
Clause 39 1 21 General Manager Professional Conduct (MPC)
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Clawback policies 4 219 Regain excessive remuneration
Clean Energy Regulator (CER) 5 333 -
CLERP (Corporate Law Economic Reform Program) (2004) 3 161 Corporate law economic reform program act 2004
The CLERP discussion paper, took into considerations the initiatives introduced by the
CLERP 9 3 161 Sarbanes-Oxley Act, as well as the recommendations of the Ramsay report.
Climate change 5 320 is an issue which we would expect organisations to address in their CSR.
Climate change accounting techniques 5 356 Taxation, 'cap-and-trade', ETSs
Coercive - Institutional theory 5 317 Three process in Institutional theory
COGA (Committee on Governmental Affairs) (2002) 3 149 Example 3.5: The Enron audit committee
Cognitive component 2 100 to determine how an individual is likely to bahave in response to an ethical dilemma
Cognitive development 2 100 Individial factors
Cognitive Process 2 100 the reasoning used in making a decisions
identifies indicators most commonly reported in large public corporations. (e.g. quality
Cohen and colleagues (2012) 5 328 rankings)
Collusive behaviour 4 253 Horizontal agreement/ Collusive behaviour/ Cartel conduct/ Cartel provision
Commercial Bank of Australia Ltd v. Amadio (1983) 151 CLR 447 4 262 -
Commissions and soft-dollar benefits 2 78 -
Committees of the board 3 146
Common causes of corporate failure (six categories) 4 208 by Hamilton and Micklethwait (2006)
Common law 4 237 Anglo-American, 'common law jurisdictions' refer page for countries
Common threats to independence and relevant safeguards: Audit and
review engagements 2 91 Table 2.17
Community service 1 14 -
Compeitive market 4 247 COMPETITION AND PROTECTING MARKETS FOR GOODS AND SERVICES
involves having the offender make payments (i.e. pay damages) to the injured party to
Compensation or Damages 4 240 compensate for the harm or loss caused.
Competition and stakeholders 4 248 -
competition law is associated with the objective of achieving free and fair competion in
Competition law 4 249 the market # Competition law protect Exporters, suppliers and consumers.
refers to the measures that governments take to suppress or deter anti-competitive
practices, promote the efficicent and competitive operation of markets and bring about
Competition policy 4 247 economic growth
Competitive advantage 4 248 eventually achieve a monopoly
Complaint (Process) 1 21 See page for steps on process for CPA Australia under Professional Disclipine
Complex financial instruments 4 210 One of the common CG failure factor
Compliance program 4 241 Professor Alan Fels, former ACCC chairman. Why have a compliance program?
Two main benefits, 1. avoid breaking the law 2. enhance its business operations by
Compliance program (Avoiding harm) (positive) (who else) 4 242 focusing on positive business purposes
Compliance requirements 3 118 Table 3.2
This approach meant that if a company chose not to comply with a governance
recommendation, the company had to identify the noncompliance and then explain it
Comply or explain (Concept of ) 3 197 to shareholders.
components of corporate governance 3 141
Conceptual framework approach 2 68 ss. 100.6-11
Conceptual framework of financial reporting 5 294 provide useful financial information about the reporting entity to investors
Confidentiality (s. 114) 2 65 neither reveling confidential informaiton nor use it self benefit. (exception by law)
Conflict of interest 3 120 examples list in Study Guide
Conflicts between two or more clients 2 74 -
Conflicts of interests (s. 210, 310) 2 74 -
Conformance 3 139 governance = conformance + performance
Conformity with standards 1 19 Quality assurance process
Consequential analysis (out come) 2 52 Teleological (or consequential) - 1. Egoism 2. Utilitarianism
Constitution of CPA Australia 1 20 Profesional discipline
Consumer protection (Common approaches) 4 259 Table 4.4, misleading conduct, list of countries
Consumers (Customers) (Stakeholders) 3 155 Must come from - a consumer, a regulator, a competitor
consumers and customers 4 258
is designed to work for consumers (and the economy as a whole) even where there is
Consumers and customers protection 4 258 no direct contractual relationship with suppliers and manufacturers.
Contingent and referrals fees 2 78 Self-interest threat to integrity
Contingent fees, referral fees and commissions 2 78 -
Continuours disclosure regimes 3 122 A key duty of directors
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Continuous disclosure obligations 4 267 local stock exchange rules (ASX listing rules)
Data must generally be provided on behalf of the corporate group by its registered
Controlling corporation 5 333 holding company.
The government has set some rules, because the profession has lost credibility. So,
Co-regulation 1 15 regulation in shared between government and the profession.
Co-regulation and professional discipline 1 15 -
'Good faith requirement' = Directors exercise power in good faith in the best interests
Corporate Act 2001 (Cwlth), s.181 (1) - Directors 5 307 of the co
Corporate Act 2012 - Phoenix companies 4 276 -
1.directors abusing their trust. 2. had negative impact on the credibility of the
Corporate Collapse (GFC Common themes) 1 34 accounting profession.
the board was not informed about key business decisions or simply chose to comply
Corporate collapse (HIH Insurance) 3 159 with MGT
Corporate culture 2 101 Patterns and rules that govern the behaviour of an organization and its employees
Corporate governance - Components 3 141 -
Corporate governance - Development (Australia) 3 160 -
Corporate governance - Failure factors 4 209 Remuneration, RM, board, shareholders' rights had played a role in GFC
Corporate governance - Failures (OECD factors) 4 210 Remuneration, Wilful blindness, Complex financial instruments
run best interests of their stakeholders, balancing act between excessive risk taking
Corporate governance - Good 3 145 and overly restrictive decision making. P-166
Corporate governance - Importance 3 139 -
Corporate governance - Improvements 4 229 -
Globalisation and better corporate governance- growth, access lower cost dept and
Corporate governance - Key factors driving the need for better CG 3 158 equity finance, increasing competition
Corporate governance - Lessons from GFC 4 209 -
Corporate governance - Risk management 4 229 -
Key factors driving the need for better corporate governance internationally (Refer to
Corporate governance - The need for better CG 3 158 page for list)
Corporate governance - The need for CG 3 132 the need arises because of the agent-principal relationship
Corporate governance - The need for CG 3 138 Stewardship theory vs. Agency theory
As part of governance, performance is related to value creation and resources
Corporate governance (IFAC) 3 140 allocation.
Corporate governance (OECD definition) 3 139 defined 'corporate governance structure'
Corporate governance framework 3 141 -
Corporate governance framework 3 141 Figure 3.2 - corporate governance framework
Corporate governance in family-owned business 3 187 -
Corporate governance in NFP 3 188 Australian Charities and Not for Profit Comission (ACNC) guidance
Corporate governance in other sectors 3 187 family-owned, not for profit, the public
Corporate governance in public sector 3 191 Economy, Efficiency, and effectiveness
Corporate governance in SMEs 3 187 family-owned
Corporate governance structure 3 139 OECD definition
Corporate governance systems by countries 3 161 Table 3.5
Corporate stakeholders 3 152 Figure 3.5 stakeholder map (a list of potential stakeholders)
Corporations 3 141 components of corporate governance
Corporations - Advantages 3 116 better than sole traders or partnership
The primary duty of boards is to shareholders, with the duty to all other stakeholders
Corporations Act 2001 (Cwlth), s.181 3 131 deriving from the duty to 'act in good faith in the best interests of the company'.
Corporations and Markets Advisory Committee 4 216 CAMAC (Corporations and Markets Committee) (2009)
is generally weighed up in economic terms and only as it relates to the decision-maker
Cost-benefit analysis (by ford) 2 54 and the employing organisation.
Cottell and Perlin (1990) 2 90 Independence
Courage 2 58 Virtue Ethics
Care must be taken even by CPAs to ensure that they do not try to become legal
CPA (Care) 4 257 advisers
CPA (Pathway) 1 37 capability consideratioin
all members must undertake ongoing professional development throughout their
CPA Australia 1 13 careers.
CPA Australia 1 14 On 4 Nov 2005, with ICAA announced the establishment of the APESB
four skill- *Technical skills, *business skills, *personal effectiveness skills.
CPA Australia (Career guidance) 1 37 * Leadership skills.
our ethos, has, as its foundation, the word 'integrity', That word is at the heart of CPA
CPA Australia (Ethos) 1 16 Australia's image
CPA Australia (Member of the APESB) 1 18 -
has place due importance on the area of self-regulation and professional disclipine by
CPA Australia (Professional disclipine) 1 20 establishing an elaborate set of rules and procedures to handle disclipinary matters.
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Joining CPA Australia means committing to upholding the reputation of the CPA
designation by adhering to the obligations spelt out in CPA Australia's Consitution and
CPA Australia (Professional disclipine) 1 20 BY-Laws, the Code of Professional Conduct and applicable regulations.
CPA Australia (SSKE) 1 38 must also possess extensive soft skills, knowledge and experience (SSKE)
recognises both TSKE and SSKE activities as satisfying CPD requirements,
acknowledging that lifelong learning for both activities is vital for professional
CPA Australia (TSKE and SSKE) 1 38 accountants
CPA Australia integrated reporting 5 330 Reporting and guidelines
CPA Australia members 2 60 must comply with APESB code of ethics
CPA Australia to investigate complaints 2 60 CPA Australia memebers rugulation - APES 110
CPA Program 1 37 capability consideratioin
Creative accounting 1 34 Means choices available to present information
Credibility 1 34 -
Credibility (Restoring) 1 36 -
Credibility of the profession 1 12 There have been number of failure in the past 15 years.
Credibility under challenge 1 34 -
Diversity - Fairness and Performance. Norway,France, Spain introduced mandatory

Credit Suisse 2012 4 217 quotas to increase gender diversity. This quotas address gender imbalance on boards
Quotas on diversity, Research by Credit Suisse found that over a six-year period,
'companies with at least some female board represenation outperformed those with no
Credit Suisse 2012 4 217 women on the board in terms of share price performance
Criminal cases (fine) 4 238 criminal offence. Beyond reasonable doubt. Focus on punishment.
Criminal penalties for cartel conduct 4 239 Million or 10% group turnover
Criminal sanctions 4 239 Million or 10% group turnover
Cross border investment 3 164 faced with barriers in relationship-based systems
Cruver 2002, p.xv 4 209 Enron culture (fear and greed) lead to corporte failure
CSR - affect profitability 5 299 revenue, clean-up cost, insurance, R&D, brand & reputation, etc.
Impositions resulting from legislation include clean-up orders, levies and remediation
CSR - Affect profitability - Direct cost 5 299 expenses.
Loss of business, increased risk, higher insurance, financing costs, opportunity costs
CSR - Affect profitability - Indirect cost 5 299 of waste production, treatment and disposal
CSR - What is measurable? 5 325 quantificaiton, monetisation, narrative reproting
CSR (CEC definition) 5 324 -
CSR (WBCSD definition) 5 324 -
CSR improve shareholder value 5 313 Enlightened self-interest
CSR or Sustainability reporting 5 309 Is evidenced by CSR or Sustainability Reporting.
CSR reporting non OECD countries 5 330 Brazil, China, Malaysia and south Africa
CSR theories 5 317 Table 5.2
CSR vs. Sustainability reporting 5 324 can be used interchangeably.
CSR-related CG disclosure 5 332 ASX CGC (2014) - Recommendation 7.4
Culture (social factor) 2 104
Custody of client assetss (s. 270) 2 88 -
Customer (Stakeholder) 3 155 Table 3.3 Nature of the corporation and some stakeholder relationships
Customer value 4 259 Re large corporations' code of conduts, good relationships with domestic customers.
D
Damaged ecosystems 5 293 Three reasons to pursue social and environmental sustainability
involves having the offender make payments (i.e. pay damages) to the injured party to
Damages or Compensations 4 240 compensate for the harm or loss caused.
Davis 2011 5 298 Major contributing factors to GFC
To achieve a desired result from among two or more options. #Organisational values
Decision making 2 99 have more signaficant effect on decision making than professional values.
may have a positive impact in that through our decision to act in a certain way,
stakeholders are clearly informed and treated fairly—but there may still be undesirable
Decisions, ethical 2 43 outcomes and ramifcations.
Deegan 2012, p.1214 5 295 Re expenses, The elements of financial reporting
Deepwater Horizon, Gulf Maxico 2010 5 320 Environmental disasters
Definition of the elements of financial reporting 5 294 Assets, liabilities, equity, income and expense
The board must not, without express authority from the corporation's consitution or
Delegation (Others, other than directors) 3 121 from the statue, delegate to others their discretion to act as directors.
Dellaportas et al. (2005) 2 68 Figure 2.1: The conceptual framework approach
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Dent 2009 2 102 Survey on business ethics
Deontological approach to the stakeholder 5 314 A deontological approach focuses on intentions, justice and duties
Deontological theories (duty based) (Kantian) 2 56 persons of good will are motivated by a sense of duty to do the right thing'
Deontological theories (Non-consequential) 2 56 asserts that there are more important considerations than outcomes.
Departures 4 212 Note 1, departures of directors
Depreciation (Higher level) 1 32 -
Depreciation (Lower level) 1 33 -
De-professionalisation 1 6 Accounting losing its professional status because it stops serving the public interest.
under Anglo-American approach, directors have indirect duties to stakeholders other
Derivative duties 3 174 than shareholders
De-Staggering 4 212 Stop engaging in the staggering sequence over time and do it all at once.
Dhaliwal et al. 2011 - cost of capital benefits 5 302 There're cost of capital benefits for companies to disclose CSR report.
Dhaliwal et al. 2011 - intermediary 5 302 CSR reporting affects capital market through intermediary - financial analysts.
Difference between ethical egoism and utilitarianism 2 55 positive benefits to oneseolf-ethical egoism / greatest number of people-Utilitarianism
Differing time horizons (Residual loss) 3 134 Examples of residual loss
Diligence (Due) 2 65 S. 130.4 and S. 130.5
DiMaggio and Powell 1983 5 317 Three process in Institutional theory (institutional theory)
Direct duties (Stakeholder)-FRC Code 3 174 must give attention to stakeholders
Direction 3 138 steer the organisation towards its performance goals
Director qualification 4 211 Must hold any particular qualifications or capabilities
Directors -3 categories 3 127 Executive, Non-executive, Independent non-executive
Directors' and their duties 3 119 list
Director's resignation 4 212 Note 1, departures of directors
Disclipinary Committee (Penalties) 1 21 Findings and decisions published on CPA Australia's website
Disclosure of confidential information appropriate 2 65 List in SG
Disclosure, transparency and remuneration 4 222 UK & US
measures of the effect of the reporting organisation divided into integrated, economic,
Disclosures on management approach (GRI specific standard disclosures) 5 339 environmental and social performance indicators.
Discount rate (environmental context) 5 295 applying a discount rate to future environmental impact has ethical implications
Discounting away the liabilities 5 296 Example 5.1
Discounting the cost of something that will occur in the future may be seen as shifting
the problems of one generation on to future generation. Discounting the cost of an
environmental or social impact may not reflect the true cost to future generations. That
is the cost may be much higher than accounted for as the cost is being shifted or
Discounting cash flow 5 295 transferred to future generations.
Dispersed investors 3 162 Market-based systems
−Automatic −By order of a court. - prescibed by regulatory agencies (ASIC) or APRA
looks for the existence of some element of legally defined commercially unacceptable
Disqualification 4 215 behaviour or relevant defined legal wrongdoing.
e.g. Dishonest, financial market misconduct, multiple insolvencies, civil and criminal
Disqualification of director 4 215 wrongs
a person currently disqualified from managing a corp cannot be appointed a director
Disqualified director 4 215 and senior executive
individuals should be treated the same unless differences exist that require unequal
Distributive justice 2 57 treatment
quotas to increase gender diversity. This quotas address gender imbalance on
Diversity (Board) 4 217 boards. 40% board member are women.

Diversity—fairness and performance 4 217 quotas to increase gender diversity. This quotas address gender imbalance on boards
Dodd, Merrick (Professor) 5 306 Social contract perspective
Dodd-Frank Act (US) 2011 4 222 effective from January 2011
Dodd-Frank Wall Street and Consumer Protection Act (2010) 3 151 A rule-based approach
'Doing well by doing good' 1 6 Enlightened self interest
Donaldson & David 1991 3 130 Stewardship theory
identifiy three virtues of particular relevance for accountants and that are necessary to
enable them to fulfil their professional responsibilities. These are expertise, courage,
Doucet and Ruland (1994) 2 58 and integrity.
Dow Jones SI 5 347
which it argued were sufficient for companies to do the 'right thing', even in the
Drivers of increased business accountability 5 308 absence of regulation.
Drummond, A 2010 4 272 Example 4.23: John Hartman-Manipulation-Insider trades and greed
Du Plessis, J. (2012) 4 219 Chairman of Rio Tinto -"spiral" 'Simple cannot continue"
Dugdale (2012) 2 64 Moral courage
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Dunn & Bradstreet CEO Christine Christian 4 208 Business are more likely to fail because of poor cash than poor sales.
Durkin & Eyers 2009 1 35 Key issues causing reduced credibility
Duty of care, skill and diligence (Exectuive directors) 3 122 with professional qualifications = higher duty of care
Duty of care, skill and diligence (Non-delegable) (NEDs) 3 122 still require duty of care but not as executive directors
Duty to exercise powers (Possible breaches) 3 120 are illegal. E.g.price fixing. Exercise powers for improper purpose
Directors must, at the time when a debt is incurred, have reasonable grounds to be
Duty to prevent insolvent trading (Basic duty) 3 123 believe that the Company can pay its debts when they are due for payment.
Duty to promote the success of the company 5 307 S. 172 of the UK Companies Act (2006). List in SG p399
Duty to retain discretionary power 3 121 -
Dwindling Resources 5 293 Three reasons to pursue social and environmental sustainability
E
East Asia 3 166 Most common company form - diversified conglomerate by a single extended family
East Asia (Corporate Governance development fronts) 3 166 conglometrate
final element of CSR. * Market Share, * Quality rankings, * Customer satisfaction, *
Economic reporting 5 328 Employee Satisfaction, * Turnover rates, * innovation.
Economic sustainability 5 321 Current systems lead to short term myopic decision-making
Economic sustainability issues 5 321 -
Economy (Legal system) 4 238 -
created the stakeholder theory to emphasise the important of a broad analysis of the
Edward Freeman (1984) 3 152 needs of all stakeholders.
Edwards et al. 2012 3 192 'The conventional specturm of bureaucratisation, commercialisation, …'
Effective competition (workable competition) 4 248 Requirements listed on page
is measured by the speed with which information provided to market participants is
Efficiency (Financial market theory) 4 269 reflected in the share price
Egoism 2 53 Ethical egoism is different from psychological egoism.
Egoist 2 53 can also refer to a group of people or an organisation
contends that each person will always act in a way that brings them sorme form of
Egoist theory 2 53 happiness or avoids some form of unhappiness.
Election exemption 4 212 ASX Listing 14.4, Australia election exception for managing director
Elements of financial reporting 5 294 Assets, liabilities, equity, income and expense
Eligible votes 4 214 Two-strikers rule
Emission - Scope 1 5 358 Directly
Emission - Scope 2 5 358 Electricity consumed
Emission - Scope 3 5 358 Indriectly e.g. air travel for work
Emission trading scheme (ETS) 5 336 -
Emission trading shemes - Majors in world (Table) 5 358 -
Emissions categories 5 358 Scope- 1, 2 and 3
Regulators hold auctions to purchase emissons reductions at the lowest available
Emissions Reduction fund 5 334 cost.
Emission-trading schemes (EU ETS) 5 336 Re philosophy on cimate change
Empire building (Residual loss) 3 134 Examples of residual loss
Employee appointment (junior/ new) 1 38 1st Technical skill.
Employee governance 4 246 important CG is a corporate policy which gives proper attention to employees.
Employee protection 4 243 Creates the Australian version of this new type of 'employee' protection
Employee representation 3 131 Employees have the right to select members of supervisory board.
Employee silence 2 101 -
Employees (generally)- operational issues 4 242 Are central stakeholders in any organisation
Employees (Stakeholder) 3 154 Table 3.3 Nature of the corporation and some stakeholder relationships
Employees behaviour 2 101 culture is strong and high ethical standards have positive influence
Energetic commitment 3 156 -
Enightened self-interest increase shareholder value 5 313 Enlightened self-interest
Closely linked with teleological positions of utilitariansism and ethical egoism.
enlightened self-interest sees the corporation as a way of maximising shareholder
Enlightended self-interest 5 313 wealth
Serving the public interest but also achieving your own self interest at the same time.
You scratch my back and I will scratch yours. Doing good by doing well..leads to
Enlightened self-interest 1 6 actions that are not the right and ethical thing to do, but will further your own interests
Enriques & Volpin 2007 3 165 'comply or explain principle' in Germany fosters transparency
Ex 1.4 - HIH, Enron, WorldCom were the most graphic illustrations of corporate failure
Enron 1 11 in the period.
Enron failure reason 4 209 Misleading financial reporting
Externalitities to be ignored + move towards accounting for sustainability would require
Entity assumption 5 297 a modification to, or a move away from, the entity assumption
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Making decisions and taking action that are in the interest of protecting the natural
Envioronmental sustainability - definition 5 319 world.
Envioronmental sustainability - key issues 5 320 1. Climate change 2. Waste 3. Pollution 4. Biodiversity
Environmental disasters - example 5 319 Example 5.1
Environmental issues have impact on profitability 5 299 list
Environmental management accounting 5 350
Environmental protection agencies (EPAs) 5 322 focus mainly on economic sustainability
Environmental reporting 5 327 similar to social reporting.
organisations with 100 or more employees to establish program to remove the barriers
Equal Opportunity for Women in the Workplace Act 1999 (Cwlth) 4 216 to women entering and advancing in the organisation.
Equality principle (Justice) 2 57 -
Equator Principle 5 344
E's (four) 1 6 Education, ethics, Expertise, Entrepreneurship
Essential basis of business 1 3 The essential basis of business ia trust.
Ethical challenges experienced by accountants 2 46 Survey by Dr Christina Neesham and Eva Tsahuridu
Ethical courage 2 100 make difficult decisions and act upon these decisions
is defined as reaching a responsible decision after taking into consideration the
Ethical decision making 2 99 general ethical beliefs of the individual. Actions,norms and rules
Ethical decision-making models 2 105 -
Ethical dilemmas 2 45 Dr. Kidder
are those who pursue an action in their own self-interest; on the other hand is a
normative theory and proposes how we ought to behave rather than how we do
Ethical egoism 2 53 behave. Maximise the net positive benefits to themselves.
Ethical egoism (Differences) 2 55 Table 2.2
Ethical issues (consequences) 2 43 affect overall profession, reduced credibility and increased restrictions
OECD principles, large international corporations and their direct obligations to
Ethical obligations (employers) 4 242 workers/employees
Ethical responsibility of a prof. Accountant 2 43 list if SG
most people do not fit into a single theoretical category and their decisions are based
Ethical theories- Concept map 2 52 on different characteristics
Corruption, anti competition, bribery, aggressive pricing, unethical marketing or unfair
Ethical trading (Social sustainability issues) 5 321 uses of power in markets.
Ethics is an agreed outcome that identifies right and wrong in particular circumstances
by way of a decision intended to be achieved in a good way or intending to acheive
Ethics 2 44 good outcomes
Ethics - an overview 2 44 Citation from Raymond Baumhart, Mitchell (2003)
Ethics (defined) Chambers 2 43 as ‘a code of behaviour considered correct’.
Ethics and morals 2 45 two terms can be used interchangeably
−Automatic −By order of a court. - prescibed by regulatory agencies (ASIC) or APRA

looks for the existence of some element of legally defined commercially unacceptable
Ethics of Disqualification 4 216 behaviour or relevant defined legal wrongdoing.
Ethos and Culture 1 16 Consists of values, norms and symbols of profession. Can also be called culture.
annouced a directive on disclosure of non-financial and diversity disclosure for
European Parliament 5 331 companies with more than 500 employees.
European Union emission trading scheme (EUETS) 5 336 -
European Union Eur-Lex (2012) 4 250 Prohibits anti-competitive business practices that threaten EU internal market
Ewart 2006 4 285 NAB example
Examples of ethical failures by accountants 2 95 -
Examples of threats 2 70 Table 2.6
Excessive non-financial benefits (Residual loss) 3 134 Examples of residual loss
Excessive remuneration 4 219 is of international concern. Having an effect
can ultimately result in devastating consequences for shareholders and othe
Excessive risk taking 3 139 stakeholders.
is when a single corporation decides, in the absence of agreements or understandings
with competitors, to deal only with certain customers or geographic regions. Civil Anti
Exclusive dealing (Third line forcing) 4 255 competitive conduct
Executive directors 3 127 Those who works as employees within the organisation
Executive directors and other senior executives's renumerstion 4 221 FRC code 2014 D.2.1
Executive remuneration packages 3 185 ASX Principle 8
Exercise powers for a proper purpose 3 120 directors act within their power and do not abuse their powers
Existence of a governing body 1 17 -
Expanding ethics 4 282
Expenses (Defined, from conceptual framework) 5 294 Limitations of traditional financial reporting
Exploited labour 5 293 Three reasons to pursue social and environmental sustainability
External auditor 3 150 -
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External auditor (Practitioner) 4 226 is required to express an opinion
It is typically taken from (or added to) traditionally calculated profits to come up with
Externality (Calculation) 5 309 some measure of 'real profit' (or, 'sustainable profit')
An entity has an impact on external parties, where such parties did not agree or take
Externality (Defined) 5 309 part in
Externality (Viewed) 5 309 Postive (Benefits) or negative (Costs)
Extraordinary general meeting 4 213 Shareholder vote to remove director
F
Faciliation payments (Bribery) 4 273 Pay to make government officials do duties more efficiently; has long been tolerated
Factors influencing decision-making 2 100 -
Fair pay and working conditions 4 244 -
False Claims Act (US) 4 284 First whistleblowing laws
Familiarity threat 2 69 -
Family and leave entitlements 4 245 -
Family controlled companies and business networks 3 168 CG code has been introduced
Family firms 3 187 Distinctive features
FBI 2013, ‘Former senior audit partner at KPMG…. 2 67 Case Study 2.1: Scott London
Features and ambitions of insider trading rules 4 270
Fees and other types of remuneration (s. 240) 2 77 -
observed that a compliance program is a system designed to asses and reduce an
organisation's risk of breaking the law. It also promotes a culture of compliance and
Fels 1999 4 242 encourages 'good corporate citizenship'
Financial accounting distortions 1 35 -
Financial adviser 1 30 Significant risk
Financial interest (s. 240) 2 77 S340, self interest threats, see page for list
Financial market governing theory- two theory- Efficiency of markets, revolves around the concept of a 'level playing field' (Where everyone has an equal
investor condidence 4 269 opportunity to compete in the market)
Financial markets (Protecting, Director rules) 4 268 The rules designed to protect financial markets apply to everyone.
Fine 4 239 criminal penalty
Firm regulation 1 19 -
Focus on short term results 5 296 Limitations of traditional financial reporting
CG is one of the criteria foreign investors increasingly rely on when deciding in which
Foreign investors 3 140 companies to invest
Four E's 1 6 1.Education, 2.Ethics, 3.Expertise. 4.Enterpreneurship
Framework for reporting with integrity 2 85 ICAEW 2007
France 3 165 Relationship-based systems - European approaches
Fraud risks (PWC report) 4 231 government bodies- page 330 and charities -332
Free good- atmosphere 5 309 for many years companies have treated the atmosphere as a free good.
Freeman, R. (1984) 5 314 Who are stakeholders?
Re Stakeholder theory: argued that the primary responsibility of the managers of a
Friedman, M. (1962) 3 116 corporation is to maximise shareholder wealth. Be 'Within the rules'
Friedman, M. (1962) 5 305
There is one and only one social responsibility of business - to use its resources and
engage in activities designed to increase its profits so long as it engages in open and
Friedman, M. (1970) 3 151 free comeptition without deception or fraud.
From self-regulation to a co-regulatory process 1 10 -
FSB (Financial Stability Board) (2009) 4 223 Remuneration, risk and the GFC
Functional view 1 11 Traditional view and Functional view of professionalism. Serves the public interest
S110-Integrity, S120-Objectivity, S130-Professional competence and due care, S140-
Fundamental Principles of the APESB Code of ethics 2 63 Condidentiality, S150-Professional Behaviour
Fundraising documents (Market manipulation) 4 272 -
G
General Manager Professional Conduct (MPC) 1 21 Clause 39
German Corporate Governance Code 3 165 stress the need for transparency, clarifies shareholders' rights
Germany 3 165 E.g. Germany and China to have employees on lower-tier board
Germany Commission 2015 3 165 enhance investors' understanding of complex civil law-based CG framework
GFC - major contributing factors 5 298 -
GFC demonstrated 5 322 weakness in one pillar can have consequences for the other pillars.
The Greenhouse Gas Protocol consists primarily of four separate but linked
GHG Protocol (Greenhouse Gas Protocol) 5 345 standards.
S260, self-interes or familiarity threats, intimidation once accepted, SEE also
Gift and hospitality (s. 250, 340) 2 79 Inducements
Global awareness of good governance 3 161 -
Global Economic Crime survey 4 231 -
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Global push for improved governance 3 158 -
Globalisation 3 158 caused major changes
is a critically important aspect of good governance. (Minimising agency costs to align
Goal congruence 3 132 interest of agent and principals)
Golden handshakes 4 223 atp > 100% of 12mths fixed pay need shareholder approval
Good corporate governance (Media) 4 268 Public disclosure, public commentary and free debate are all very important to...
Good faith requirement 5 307 S.181(1) of the corporations Act
If bargaining process fail then indestrial action may occur - *go slows, work to rule, or
Go-Slows (deleberately working slow) 4 247 strickes.
Governance and performance 3 140
Governance failures - Other Issues 4 210 1.Remuneration, 2. Wilful bildness. 3.Complex financial Instruments
Governance in other sectors 3 187
Governing body of a profession (Role) 1 17 Important enabling role:
Government (Stakeholder) 3 153 Table 3.3 Nature of the corporation and some stakeholder relationships
Government bodies 4 231 -
Can be employed as a means of placing costs on the use of resources that might
Government intervention (externalities) 5 309 otherwise go unrecorded.
Goyal 2012 4 219 Economic times : Indian corp to remunerate top executive on a global scale
Grant Thornton 2014 4 232 Growing strengths of the governance of charities and NFPs
Gray & Owen et al. 2010, p26 5 315 managerial stakeholder theory
Gray, R., Adams C.A. & Owen D. (2014) 5 313 Different CSR theories
Greenbury Committee 3 159 UK, in 1990s, made to enhance transparency of directors' remuneration
Greenwood, E. 1957 1 8 Eight attributes to confirm the existence of a 'profession'
GRI (Global reporting Initiative) 5 339 most widely used guidelines for CSR or sustainability reporting.
*Strategy and analysis, *Organisational profile, *Indentified material aspects and
boundaries. *Stakeholder engagement. *Report profile. *Governance *Ethics and
GRI standard disclosures - general 5 339 integrity.
GRI standard disclosures - specific 5 339 * Disclosures on management approach * Indicators
Griffiths 2011 4 275 Bribery allegations , example 4.30
Guinness beer company 1980s 4 272 Runs (market manipulation)
Guthrie, J. & Parker, L. D. (1989) 5 319 History of CSR reporting in BHP over 100 years
H
Halligan & Horrigan 2005 3 192 characteristic of public sector
Hamilton and Micklethwait (2006) 4 208 Common causes of corporate failure (six categories)
became known as the supercode abd was adopted into the listing rules on the London
Hampel Report / Hampel Committees 3 159 Stock Exchange
NFPs are dedicated to a wider purpose, not distribute earnings back to those in
Hansmann (1980) 3 195 exercise control.
include a feeling of joy or delight, satisfaction or peace of mind, and the sense of
Happiness (Egoist theory) 2 53 acheiving one's goals or desires.
Harper 2012 4 227 Centro case, example 4.9
stated guiding principles to achieve more effective governance by boards in public
Harris (1997) 3 191 sector
Aus, UK and US - disclosure of executive remuneration to shareholders and
Having a say on pay 4 219 community
Heaney (2011) 4 208 Business are more likely to fail because of poor cash than poor sales.
Hecar case 4 248 The correct approach to determine the state of competition in a market
Henry Bosch 3 145 Board's responsibilities and functions
set of decision making rules. * decisions are based on decision rules or rules of
Heuristics approach 2 105 thumb.
HIH 1 11 in the period.
History of CSR reporting 5 319 -
Hoffman. W.M 2 54 -
undertakes a number of functions involving regulation, legislation development,
Hong Kong Competition Commission 4 251 competition law education, prosecution and administrative decision-making.
Hopwood, Unerman and Fries (2010) 5 323 Business's credibility on sustainability issues & its ability to win and retain customers
That board has increased responsibility for taking into consideration broader factors
Hopwood, Unreman and Fries 2010:OECD 2011, IIRC 2013 5 323 beyond financial profits and performances.
Horizontal agreement 4 253 Horizontal agreement/ Collusive behaviour/ Cartel conduct/ Cartel provision
Horizontal price-fixing (Legal) 4 257 Taxi fares is one good example
Hornsby Building Information Centre Pty Ltd v. Sydney Building
Information Centre Ltd (1978) 140 CLR 216 4 260 -
Hostile takeover 3 120 Exercise powers for improper purpose
Hostile takeover 3 162 market-based systems
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Hostile takeover 3 164 rarely happen in relationship-based systems
How 'soft skills' can boost your career 1 38 Reading 1.3
HSBC 2012 4 282 'Ethical and environmental code of conduct for suppliers of goods and services'
are more fundamental to society and relationships, and are the key to maintaining
Human rights 2 57 social order.
freedom of choice, right to the truth, right to privacy, freedom of speech, right to life,
Human rights (Consists) 2 57 right due to process and the right to what is agreed
Humanistic perspective 5 319 Human rely on natural environment for survival
Hybrid organisation 5 324 Social enterprises
I
ICAEW (The Institute of Chartered Accountants in England and Wales
(2007) 2 85 Reporting with integrity
ICGN (The International Corporate Governance Network) 3 159 Other international CG approach
Ideal of service to the community 1 13 -
Ideals of accounting-entrepreneurialism and professionalism 1 6
This approach meant that if a company chose not to comply with a governance
recommendation, the company had to identify the noncompliance and then explain it
'If not, why not' approach 3 179 to shareholders.
IFAC 3 140 Performance as part of CG is related to value creation and resources allocaiton.
Accountants and effective governance - to help the board to make strateigc decision,
IFAC (2004 p.4) 3 141 risk …
recommend a strategy committee to review strategy including risk (Risk MGT
IFAC (2004) 3 150 committee)
IFAC (2005) The Roles and Domain of the Professional Accountant 1 28 IFAC research
IFAC (2009) 4 229 about internal control
IFAC (2010) the Role of SME 1 28 Accounting in small and medium enterprises (SMEs)
IFAC (2013) Professional accountants in business 1 28 IFAC research
identified risk as being important for both performance and conformance aspects of
IFAC PAIB (IFAC 2004) 3 150 CG
IIC (Institutional Investor Committee) (2011) 4 279 The representation role of institutional investors
Immanuel Kant (1724 - 1804) 2 56 -
Impact investment 5 304 Investing capital to actively create social benefit (highest level)
Impact of ethical or unethical decisions 2 43 example in SG
Impact of the legal system on the corporation 4 237 Anglo-American, 'common law jurisdictions' refer page for countries
can be considered at the individual level as well as in relation to the whole profession.
At a broad level, we have already identifed that the accounting profession has suffered
reduced credibility and increased restrictions on its ability to act autonomously and to
Impact of unethical decisions 2 44 self-regulate.
Importance of governance 3 139
Improving corporate governance 4 229 two important recommendations
Independence 2 88 Independence: (both integrity + Objectivity) inportant for Public accountant.
Independence checklist for employees 2 91 Figure 2.10 (to be used annually)
means, avoiding situations that could cause a reasonable oberserver to question your
Independence in appearance 2 88 objectivity.
Independence-Audit, review and other assurance engagements 2 88 ss290-1
Independent directors 3 127 crieteria to determine the independence
India 3 168 follows Anglo-American model, but requires a system balancing with its unique culture
Indirect duties (Stakeholder)- FRC Code 3 174 derivative duties
Individual factors 2 100 Cognitive development
want companies to be run efficiently and profitably. Also, wants honesty from directors
Individual shareholders 3 142 and managers.
Inducement (s. 250, 340) 2 79 -
If bargaining process fail then indestrial action may occur - *go slows, work to rule, or
Industrial action 4 247 strickes.
Influence (Factors) individual behave in their workplace 1 25 How an individual will behave in the workplace (See page for list)
Influences on an individual's decision 2 99 Figure 2.3
Information and the media(financial market) 4 266 -
Information asymmetry 3 132 Agency theory: ageents has better access to information than principle
Re stakeholder theory, one should not focus on a stakeholder just because they have
power or influence over the organisation. One should focus on stakeholders because
Inherenet worth 5 314 of their inherent worth.
are hearings where courts try to act quickly to prevent wrongs from continuing or
becoming worse by getting a corporations, for example, to stop its anti-competitive
Injunctions 4 240 conduct.
Inside information 4 267 If these criteria are met, it is called inside information (page 338 criteria)
Insider system 3 164 relationship-based systems, stakeholder system (Germany, France, Japan, China)
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List of people with inside knowledge, Example 4.22: Insider trading-Hong Kong
Insider trading 4 268 responses
Insider trading (Rules and procedures) 4 270 Range of common features and ambitions across many countries
Insolvent company 3 123 If a company becomes insolvent, the directors must not allow it to incur further debts
Insolvent trading (Penalties) 3 124 Serious penalties can be imposed
Inspire employees 3 156 managers should do
Instituional Shareholders' Committee 4 279
Institutional investor (Shareholder representation) 4 279 -
Include insurance companies, pension funds, investments trusts and professional
Institutional investors 3 143 investment fund managers.
institutional theory suggests organisation's follow the actions of other
organisations.Institutional theory is useful because the practice of CSR has changed
Institutional theory 5 316 considerably over the last decades.
Instrumental climates 2 102 -
by an organisation are a direct function of the risks in existence and 'due diligence'
compliance programs-including legal compliance-are a major factor in achieving
Insurance premiums payable 4 241 reduced corporate risk
Integrated report aims 5 340 -
Six concepts - Financial capital, Manufacturing capital, Human capital, Social and
Integrated reporting 5 340 relationship capital, Intellectual capital, Natural capital.
IIRC's conceptual framework to capture an organisation's resources and relationship.
Integrated reporting (Definition) 5 325 See 'Six capitals concept'.
The active consideration by a company of the relationships between its various
operationg and functional units and the capitals that the organisation uses and affects.
Integrated thinking (Definition) 5 325 (IIRC 2013)
shall not knowingly be associated with reports, returns, communications or other

Integrity ( accountants shall not knowingly associated with reports ) 2 63 information where they believe that the information: (refer to page for three options)
Dictionary defnitions of integrity focus on the notions of entireness, soundness,
Integrity (S111) 2 63 wholeness, an unimpaired state, uprightness, honesty and purity.
Integrity is the motto 2 63 -
Interaction with society 1 24 -
Inter-corporate shareholdings 3 164 Relationship-based systems - European approaches
Management has to act in the interests of shareholders,also interest of the enterprise
Interet social de l'enterprise 3 165 to ensure its survival.
Intergeneratiol perspective 5 319 Unfair burden to future generations
has produced detailed methodological guidance for reporting on greenhouse gas
Intergovernmental Panel on Climate Change 5 327 emissions.
Internal auditor 3 150 -
Internal control - Integrated Framework (COSO 1994) 3 159 gives a detailed definition and discussion of internal control
Internal control and risk management 3 150 Risk committee
International airline pricing cartel 4 255 ACCC, price-fixing, Malaysia Airlines Cargo, Price-fixing cartel
International competition legislation and regulators 4 249 Refer here for Table 4.3
International debates about remuneration levels and fairness 4 219 Indian corp to remunerate top executive on a global scale
International development timetable 3 159 -
International Education Standards 1 13 IAFC inssued, covers theory and knowledge
International experience of bribery and corruption 4 274
Issued International Education Standards which outline the core competence areas all
aspiring professional accountants must satisfy in order to be recognised as a member
International Federation of Accountants (IFAC) 1 13 of the profession, and of a professional body
International Federation of Accountants (IFAC) (2005) 2 60 Part C: Compiled APES 110 (CPA australia rely on )
International Federation of Accountants (IFAC) (2010) 2 60 The public interest - Ethics in practice
International Integrated Reporting Council (IIRC) 5 340 Integrated reporting
International Labour Organization (ILO) conventions 5 326 An international labour standards
Key factors driving the need for better corporate governance internationally (Refer to
International perspectives on corporate governance 3 158 page for list)
Intimidation threat 2 69 -
Intimidation-A threat to the fundamental principles 2 69 Example 2.9 Intimidation
IntOSAI (international organisation of supreme audit institutions) 3 191 identified 3Es as the heart of public sector governance
Investor (Stakeholder) 3 153 Table 3.3 Nature of the corporation and some stakeholder relationships
Investor advocate (Shareholder representation) 4 278 e.g. shareholder associations; Australian Shareholders' Association (ASA)
ISA 315 (IFAC 2009) 4 229 about internal control
Islamic finance 5 305 Question 5.1
Isomorphism 5 317 homogenisatio, 同质化
Issue of Australia mandatory disclosure 5 335
Issues of 'reliable measurement' and 'probability' 5 332 IAS 37 - Liabilities & Provisions related to Externalitities difficult to measure
J
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James Hardie case 3 126 Example 3.4 illustrate the importance of directors not relying on others for duty of care
Commissioner Jackson raised issues about corporate governance, " Just because you
James Hardie Industries NV 2 45 are complying with the law does not mean you are acting ethically. "
revealed that corporations are beginning to recognise the need to curb remuneration
Jan du Plessis, chairman of Rio Tinto 4 219 excess.
Japan (Corporate governance) 4 282 now the code recommends at least one independent director
Jarvis, J. (2005) 1 38 How "soft skills" can boost your career
Jensen & Meckling (1976, p. 308) 3 132 define agency theory and its central problem
Johnson 1972 1 6 Professions never really had a public interest or service ideal.
Justice theory 2 57 1. precedural justice 2. Distributive justice
K
Kant (Deontological) 2 56 persons of good will are motivated by a sense of duty to do the right thing'
set of companies with interlocking business relotionships (banks hold equity in
Keiretsus 3 167 companies)
is that no individual should be involved in setting or determining their own
Key governance principle 4 222 remuneration levels
Key issues causing reduced credibility 1 34 Chambers (1973), Durkin, P. & Eyers, J. (2009), Eyers, J. (2009), Sikka, P. (2009)
Key Management Personnel 4 214 KMP are- planning authority, controlling activities of entity directly or indirecty
De-staggering - 2nd paragraph (three to max five years) director has to stand for re-
Kiel et al. 2012, p. 215 4 212 election.
Kiel, G. & Nicholson, G. 2012 3 141 CG framework, Directors at work
Kirkpatrick, G. 2009 4 209 CG lessons from GFC
Klettner & Clarke 2015 4 217 Board diversity
KMP definition 4 214 KMP are- planning authority, controlling activities of entity directly or indirecty
Kohlberg 1981 2 100 Cognitive development, moral development
KPMG 2013 survey 5 352 CR is the standard business in worldwide now.
Ku-ring-gai Cooperative Building Society Ltd 4 256 Third-line forcing (misuse of market power)
Kyoto Protocol 5 355 Commits industrialised countries to reduce their emissions. Six green house gas.
L
L J HL Bolton Engineering Co. Ltd v. TJ Graham & Sons Ltd [1957] 1 QB
159 at 179 3 130 describes the roles of 'company' and 'directors'
In most European countries, ownership and control are held by cohesive groups of
insiders who have long term stable relationships with the company. (e.g. family
La Porta, Lopez-de Silanes & Schleifer 1999 3 164 interests, industrial allies)
also known as trade union or just a union, Commonly seek to achieve outcomes
Labour union 4 247 through collective bargaining with employers.
Lack of auditor independence 1 35 -
Lamers (2009) 4 208 The importance of cash flow and ongoing viability to prevent corporate failure
Langenderfer, H. Q. & Rockness, J. W. (1990) 2 108 American Accounting Association Model
Larson (1997) 1 3 Was concerned monpololistic professionals....
Lavelle (2002, p28) 3 149 Example 3.5 - The Enron audit committee
Law and regulation 2 104 -
Laws leading to criminal penalties (Cartel conduct) 4 238 Million or 10% group turnover
proof based on the balance of probabilities, Pecuniary, payable to the state. Results
Laws with civil outcomes and civil penalties 4 239 from a civil penalty
Leaders 1 37 -
Leadership 1 37 -
Leap frop investments (2014) 5 304 Thematic investments
Leave entitlements (Australia, UK, US, singapore) 4 245 US 2 week. Aus, UK 4 week. Singapore maximum 14 days after eight years.
Lee (1995) 1 6 Described the concept of 'Enlightened self-interest'
Legal compliance and governance 4 241 -
1.Change and inform. 2. Change perceptins without actual change. 3.Deflect attention
Legitimacy methods 5 316 and manipulate perceptions. 4.Change criteria for evaluation.
Legitimacy theory 5 316 -
Lenders (Stakeholder) 3 153 Table 3.3 Nature of the corporation and some stakeholder relationships
Level of Regulation by corporate structure 3 119 Fig 3.1
Level playing field 4 269 Where everyone has an equal opportunity to compete in the market
Leyden 2008 4 223 Tightening rules regarding remuneration
financial reporting alone cannot answer important questions about social and
Limitations financial results 5 294 environmental performance. List in SG P412
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Scope of reporting, elements of financial reporting, the practice of discounting future
cash flows, reliable measurement and probalitity, focus on short term results and the
Limitations of traditional financial reporting 5 294 entity assumption.
Limited liability 3 116 shareholder's liability is limited to the value of their shares in the corporation
Legitimacy is established through legitimation, which can be described as the process
Lindblom (1994) 5 316 the organisation pursues in order to achieve legitimacy.
Lionidis, G. (2013) 4 219 Example 4.2: Remuneration-Headline illustration
Litsky & Eddlestone et al. 2006 2 101 -
Long-term viability of business 5 321 Myopic decision making (Economic sustainability issues)
is a product that is sold below cost price to entice resellers/customers into a selling
Loss-leader/loss leading 4 257 outlet. Most commonly occurs at the retail level
M
Malaysia airlines / International airline pricing cartel 4 255 ACCC, price-fixing, Malaysia Airlines Cargo, Price-fixing cartel
Management 3 155 -
can ultimately result in devastating consequences for shareholders and othe
Management enthusiasm 3 140 stakeholders.
Managerial Stakeholder theory 5 315 Additional effort on stakeholders more important or powerful
Managers skills 3 156 intellectual, operational and technical skills
Mandatory and voluntary CSR reporting 5 330 -
Mandatory CSR reporting in non OECD countries 5 330 Brazil, China, Malaysia and south Africa
* Comply or explain basis. * listing requirement in non OECD countries Brazil, China,
Mandatory reporting (CSR reporting) 5 330 Malaysia, South Africa.
Market control view (Professions) 1 11 Allen 2006 (HIH), West 2003
Market manipulation 4 270 Example 4.27: David Jones - a market manipulation event p.267
Market Manipulation 4 270 excluding insider trading as its a separate wrong
Abuse of market power is corp. has used that power to eliminate a competitor or
prevent competitor from entering or properly competing in market for goods or
Market power 4 249 services.
Market sensitive information - Examples 3 122 ASX Continuous Disclosure Guide (ASX 2014)
Market sensitive information - Test for disclosure 3 122 Australian Corporation Act
Dividing up markets, customers or regions between competitors is another way of
Market sharing (allocating customer, suppliers or territories) 4 253 limiting competition
Market, the (Susceptible to/ Role of markets) financial market 4 265 stock market, securities market
Market-based systems 3 162 outsider system, Anglo-Saxon sytem, shareholder system
Market-based systems 3 162 US, UK, Australia, NZ
Mason J, p462 4 262 Unconschionable conduct
Maximise the wealth 3 116 Corporations, Friedman, M. (1962)
McKenzie & Baker (2015) 4 275 more effective legislative frameworks in US and UK than Australia
McKinsey report 5 306 good business practice.
Mclntyre D.A 2011 4 224 Cisco. John Chambers, CEO, highest paid. Example 4.3
Measurability and Probability are key considerations 5 296 Limitations of traditional financial reporting
Measurable (What is measurable?) 5 325 Social, Environmental, Economic
Measurement (Defination) 5 325 refers to collecting, analysing and assigning quantitative values to an issue.
determining what is right according to a set of duties or by systematically analysing the
Melé (2005) 2 58 consequences does not motivate appropraite behaviour
Member in business: Sonya Denise Causer (August 2010) 2 96 -
Member in public practice: Trevor Neil Thomson (May 2010) 2 96 -
Members in public practice: Warren Sinnott (June 2014) 2 96 -
Mergers and Acquisitions 4 252 relevant market
Merit principe (justice) 2 57 -
Who embraced the view that organisations survive to the extent that they comply with
Merrick Dodd 5 306 the Social contract negotiated between the organisation and society. Table 5.1
Miceli & Near 1984 4 283 Defination of whistleblowing
Milliken & Morrison et al. 2003 2 101 -
Milton Friedman (1970) 3 151 see "Friedman"
Mimetic - Institutional theory 5 317 Three process in Institutional theory
Minority interest 4 278 A safeguard for MI - the 'oppression remedy' in Australia's Corporations Act
Example 4.25: Apple and '4G iPads' ACCC (Australian Consumer & Competition
Misleading conduct and representations 4 260 Commission) (2012c)
Misleading conduct approaches 4 259 table 4.3
Mitigation 5 355 UNFCCC established an institutional framework - to reduce emissions - mitigation

Monetisation 5 326 CSR reporting - covert a quantified value into currency
Monitoring costs - borne by principle 3 133 costs to company of monitoring management performance
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There has been a significant abuse, not just by the directors, but by all involved in the
Monks and Minow (2008) 4 209 corporate governance process, even shareholders.
Are able to reduce supply below the competitive level in order to maximise profits,
Monopolist corporation 4 247 artificially high prices
Monopolists become complacent(meaning satisfied) and do not keep up with latest

Monopolistic behaviour 4 247 trends and technologies > result > Technological obsolescence(uselessness)
Monopoly (Government created) 4 249 NBN, OECD, Legislated monopoly
where a profession determines who can work in an industry, which protects members
Monopoly control 1 8 against competition.
Exclusive right to practice accountancy and auditing in return for acting in the public
Monopoly position 1 8 interest.
moral agents are rational persons, who are capable of understanding what it means to
Moral agency (Traditional theory) 2 58 act morally and ethically.....
Moral courage. (example) 2 64 Example 2.8: Dugdale, L (2012)
Moral development 2 100 have verying capacities to judge
Motive (deontological theory) 2 56
1.Standard setting. 2. Conformity with Standards. 3. Practice reviews. 4. Accounting
Multi-level regulatory framework 1 19 firm regulation.
Myopic decision making 5 321 Long term viability of business
N
Nakamoto, M. (2012) 4 283 Former Olumpus chief warns on governance
Napoleonic code 3 164 Relationship-based systems - European approaches
Narrative reporting 5 326 CSR reporting - express an issue in qualitative form
National Australia Bank (NAB) (Diversity) 4 218 Early adopter of diversity
National Employement Law Project (NELP) 5 300 report into Walmarts worker exploitation in the US ('Chain of Greed' report)
National Greenhouse and Energy Reporting Act (NGER) 5 333 Table 5.3
National Greenhouse and Energy Reporting Act 2007 (CWlth) (NGER In Australia, large business that exceed relevant thresholds are required to report their
Act) 5 333 greenhouse gas emissions, greenhouse gas projects, energy use and production.
National pollutant inventory 5 335 enable public via internt to find related info.
Natural capital (Definition) 5 325 -
Natural capital accounting 5 325 The process of calculating the total stocks and flows of natural capital available.
Natural capital accounting (Definition) 5 325 -
Natural Capital Coalition (2014) 5 314 Natural capital accounting
Naturalistic perspective 5 319 Nature has intrinsic value and deserves preservation
Natutal capital 5 314 world stock of natural assets. -air, water, land, soil, geology and biodiversity.
NBN 4 249 Monopoly, OECD, Legislated monopoly
Needs principle (justice) 2 57 -
Europeans emphasize cooperation and consensus, while Anglo-Saxon focus on
Nestor & Thomson (2000) 3 164 competition
In market-based CG system, equity funding is more important than funding from bank
Nestor & Thomson (2000, p.7) 3 162 loans.
The agency problem of the market-based system is less than in relationship-based
Nestor & Thomson (2000, p.9) 3 164 system.
News corporation phone hacking scandal 4 211 Lack of good CG
NGER Act (Objectives) 5 333 -
NGER Act (Registration) 5 333 Businesses are required to apply for registration with the CER if they:
* Greenhouse gas emissions, *energy production. *Energy consumption. *other
NGER Act reporting threshold 5 333 information specified under NGER legislation.
NOCLAR (Non-compliance with Laws and Regulations s. 260, 360) 2 81 Responding to NOCLAR
Primarily responsible for recommending the succession procedures within an
Nominee committee 3 147 organisation
Nominee directors represent third party interests, such as major shareholder, a class
Nominee directors 3 121 of shareholder or a holding corp.
Any attempt to delegate these 'non-delegable' functions will firstly comprise

Non-delegable (Centro and James Hardie) 3 121 inappropraite action by a director and will not deem the director immune from liability.
Non-executive directors 3 127 Those who do not work within the organisation
Non-executive directors renumeration 4 220 -
Normative (one of the three isomorphic processes) 5 317 Institutional theory
Normative ethical theories (Categories) 2 51 Teleological (or consequential) and deontologial (or non-consequential)
establish principles guiding individuals on how they SHOULD behave. " " propose
principles that distinguish right from wrong by establishing a norm or standard of
Normative ethical theories (In principle) 2 51 correct behaviour that should be followed at all times.
Normative stakeholder theory 5 314 deeply rooted in deontological ehtical theory- e.g. Fiduciary duty / optimal balance
Normative theory (Example) 2 53 is stakeholder theory - Refer to page for Example 2.4
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is represented by a value judgement on what should or ought to be done. It aim to
determine what ought to be done, which must be distinguished from what is
Normative theory (What is) 2 51 happening or being practised (psychologicl theories)
Not for profits (NFPs) 1 31 Also called community or third sector
Note Priting Australia NPA 4 232 Bribery and corruption
Not-for-profit organisations (different forms) 3 188 provision of social service, arts and entertainment sectors, sports & leisure
Not-for-profit organisations (key objective) 3 188 improve trust and relationships with stakeholders
Not-for-profit organisations (vs. profit-oriented) 3 188 accountable to stakeholders not shareholders
O
O’Bannon, I. M. 2014 2 67 Case Study 2.1: Scott London
Objective of the philosophical approach 2 105 is to provide a framework-ethical issues can be identified, analysed and resolved.
refers to the state or quality of being true, outside of any individual feelings or
Objectivitiy (S 120) code of ehtics 2 64 interpretations
Objectivitiy (Three obligations) 2 64 They should be impartial, honest and free from conflicts of interest.
Objectivity - all services (s. 280) 2 88 -
Occupational health and safety 4 243 In Australia has reduced significantly. (example 4.5)
OCED (2010) 3 171 identified the failure to identify and manage risk as being central to GFC
OECD 5 322 focus mainly on economic sustainability
OECD (1999) 3 139 defined the corporate governance structure
OECD (2010, p.3) 4 209 identified that common CG weaknesses had played important role in GFC.
OECD (Organisation for Economic Co-operation and Development)
(2010) 4 249 NBN, Monopoly, Legislated monopoly
OECD principles (Auditor) 3 174 Princial 5 (Disclosure and transparency)
OECD Principles (Principle 1) 3 171 Ensuring the basis for an effective corporate governance framework
OECD Principles (Principle 2) 3 172 The rights of shareholders and key ownership functions
OECD Principles (Principle 6) 3 175 The responsibilities of the board
Are general or principles-based. Are good practice guidelines and are not written for
companies or directors. Witten for governments guidance. Also be used for profit
OECD Principles (Purpose) 3 171 seeking business and not for profit org.
OECD Working Group on Bribery in International Business Transactions 4 274 Demonstrated increased global awarenss of bribery.
Office for the not for profit sector (2013) 1 31 Not for profits (NFPs) situation in Australia
Olympus Corporation 4 283 expanding ethics example 4.233
OPEC 4 254 Cartel output restrction
Operative provision ('section') 4 238 -
Opinion shopping 2 87 Second opinions
Australia - Safeguard for MI in case of wrongdoing, inaction or abuse of power
Oppression remedy 4 278 (Corporate Act)
Organisational culture and significant others 2 101 -
Organisational legitimacy 5 315 -
#Organisational values have more signaficant effect on decision making than
Organisational values 2 101 professional values.
Origin Energy (2015) 5 316 The social contract
Other issues linked to governance failures 4 210 Remuneration, Wilful blindness, Complex financial instruments
Other real costs 4 241 associated with publicised wrongdoings - Refer to page for list
'Out of position' 3 155 Directors acting 'out of position' and attempting to play a management role.
Outboard Marine Australia Pty Ltd 4 248 workable competition
Output restrictions (Cartel conduct) 4 254 supply of product in the market
Outsider system 3 162 market-based systems, Anglo-Saxon system (US, UK, Australia, NZ)
P
Research paper 2005, Another paper in 2008 - (IFAC-*managing risk. *Upholding
PAIB Committee 1 29 integrity. *Establishing a common "performance language".
PAIB Committee (Activities) 1 29 Table 1.6 - Description of activities & examples
recommend a strategy committee to review strategy including risk (Risk MGT
PAIB of IFAC 3 150 committee)
Pande & Kaushik 2011 , p.2 3 168 CG in India - dominant shareholders abuse power; weak enforcement of CG
When Company Y sets price and Company X sets price at the same level (Without
Parallel conduct/pricing. Price-following 4 254 both of them colluding) Price-setting activity that is lawful NOT price fixing
Partner appointment (SSKE and TSKE) 1 38 1st. Interpersonal skill. 2nd. Leadership. 3rd Communication
Saravanamuthu 2004,"service ideal" may have existed in the past, but has been
Partner in business 1 6 abandoned for a more lucrative role as ‘partner in business’
Payment of underserved remuneration 4 221 FRC 2014 p.20
Payments for past and future performance-And motivation 4 220 -
Pecuniary penalty 4 239 civil wrong, payable to the state. Results from a civil penalty
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Peers 1 11 -
Penalties and appeals 1 21 -
Per se illegal (Automatically illegal) (anti-competitive behave) 4 253 -
Percy (1995) 3 147 audit committee should review the adequancy of IC and FS prior to board approval
Performance 3 139 Governance = Conformance + Performance
Performance-based remuneration 4 221 -
Perks (perquistites) 3 134 Excessive non-financial benefits (residual loss)
Permanent Subcommittee (2002) 4 226 Audit and related regulation
Personal aggrandisement 3 134 Empire building (residual loss)
Personal Consequences 2 44 Ethical failings of individual accountants may suffer
where personal greed is put ahead of the interests of shareholders and other
Personal fiefdoms 3 140 stakeholders.
Philosophical model of ethical decision-making 2 107 4 questions
Phoenix companies 4 276 Two legislations in Australia (Corporations Act 2012)
Pike River Coal Mine 4 246 employee governance failure
Pillars of sutainability 5 322 1.Environmental. 2.Social 3.Economic
Ponzi Schemes 4 276 -
Pools (Market manipulation) 4 272 -
Poor audit quality 1 35 -
Example 2.12 Poor ethical cultures cause significant trouble, Sims, R. R. &
Poor ethical cultures cause significant trouble 2 102 Brinkmann, J. (2002)
Positive externalities (Externalities) 5 309 Products or services that have widespread social benefits.
Potter (2011) 4 280 Example 4.25: News backs Murdoch despite shareholder threat
cleary defined in law: *change constitution *appoint and remove director. * approve
Power of shareholders 3 129 directors' remuneration
Practice reviews 1 19 Quality assurance process
Practitioner (external auditor) 4 226 is required to express an opinion
Specific example of market power. Predatory pricing is the supply of goods or services
Predatory pricing 4 250 below cost price over a period of time.
Preparation and presentation of information (s. 220) 2 84 -
President Director General (PDG) 3 165 who combines chair and CEO, and the role of NED is muted - France
Prestigious benefits (perks) 3 134 Excessive non-financial benefits (residual loss)
Price fixing (cartel conduct) 4 254 Example 4.13: Midland Brick case
Identifying an agreement between suppliers as parallel conduct and price-following is
Price-fixing (Determining) 4 254 lawful
Primary duty (Accountants) 2 61 is to the public
Primary loyalty (Accountants) 2 61 is to the public
Principal 3 138 Those whose right or interest being looked after = principals
Principle-based vs. Rules-based regulation 3 151 -
Principles based climates 2 102 -
Principles relating to market manipulation 4 271 -
Principles-based approach 2 102 -
Private sector vs. Public sector 3 191 different in values, objectives and methods
Pro bono 1 14 Latin term- for the good
Procedural justice 2 57 was the process fair?
The report notes that in Germany, public limited corporations must provide a
breakdown of total earnings of each member of the management board. Corporations
can opt out where three quarters of shareholders vote to do so for a maximum of five
Productivity Commission 2009, p245 4 222 consecutive years
Productivity Commission report (2009) 4 214 2009 report , Disclosure, transparency and remuneration
Oxford dictionary : Defined as an occupational area or vocation that 'involves
Profession (What is a) 1 8 prolonged training and formal qualification'
is objective, takes full responsibility for the tasks they are entrusted to do, adopts
proper planning and control procedures, and possesses the integrity to maintain a
professional approach to work. Impact of ethical or unethical
Professional accountant (ethics) 2 43
Professional accountants in business 1 27 -
Professional appointments (s. 320) 2 86 -
Professional behaviour (s. 115) 2 65 -
Professional competence and due care (s.113) 2 64 -
By-Laws of CPA Australia, has place due importance on the area of self-regulation
and professional disclipine by establishing an elaborate set of rules and procedures to
Professional discipline 1 20 handle disclipinary matters.
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# comprises conduct that is legal, objective, competent, ethical, responsible,

performed in the best interests of the public, and which maintains the image and
credibility of the profession. # is the application of ethical principles by professionals
who have an obligation to those who rely on their services # involves the utmost care
in the discharge of one’s duties. #Demands the existence of a pretermined framework,
Professional ethics 2 43 or a set of rules, to guide the professional when making ethical decisions
Professional ethics framework 2 43 must be written based on extensive experience from the profession
Professional fees 2 77 Self-interest threat to professional competence and due care
Professional fees (safeguards) 2 78 -
Single most important attribute of a profession. Diagnose and solve complex,
Professional judgment 1 16 unstructured valus based problem. Becker-1982
Professional relationship (Key) 1 24 employers, clients, employees and their peers
Professions—the ‘market control’ view 1 11 Allen 2006 (HIH), West 2003
Proof, penalties and redress—criminal and civil 4 238 -
Proper purpose 3 120 directors act within their power and do not abuse their powers
is a document issued by a corporation to establish the terms of of an equity issue (or a
Prospectus (What is) /rules 4 272 debt raising) S612 of the Corporations Act
Protecting financial markets 4 268 The rules designed to protect financial markets apply to everyone.
Provision of non-assurance services to audit clients (s. 600-610) 2 93 -
Prowse (1998) 3 166 Relationship based systems - Asian approaches
a theory of human nature, is concerned with explaining how people behave. According
Psychological egoism 2 53 to this view, people do pursue their self-interest, sometimes at the cost of others.
Public accounting a profession? 1 30 Application of professional judgment
Public interest 1 3 -
encompasses the pursuit of excellence (including integrity, objectivity, independence,

confidentiality, adherence to technical and professional standards, competence and
Public interest (serving the) 2 61 due care, and generally acceptable ethical behaviour) for the benefit of others.
Public interest or self-interest? 1 3 -
Public practice (accountant) 2 74 Are concern with objectivity/ Ongoing fees
Public practice accounting 1 25 -
Public Sector 1 30 -
Public sector governance 3 191 Economy, Efficiency, and effectiveness
Puffery (Trade Practices Commission's view) 4 261 Extreme exaggeration. Puffery is acceptable
Puma (Environmental reporting) 5 328 Natual capital: released its first environmental profit and loss account in 2011.
Pursuit of excellence 1 13 -
Pwc research 4 231 Governance issues in government
Q
Quality assurance process 1 19 -
Quality control (Elements) 1 19 APES320 Quality Control for Firms
Quantification 5 326 CSR reporting - express an issue in numercial terms
R
Examined the adequacy of Australian legislative and professional requirements
regarding the independence of external auditors and made recommendations for
Ramsay Report 3 160 changes.
Rana plaza 5 321
Rating agencies 4 268 Fitch, Standard and Poor's, Moody's (All three are US based ratings agencies)
Rawls 1971 2 57 Difference principle
Raymond Baumhart 2 44 ‘What does ethics mean to you?’
Wrongdoers required to correct the harm they have caused. Compensation, damages,
Redress compared with penalties 4 240 Injuction
Referrals 2 87 -
Regulating and anti-competitive conduct 4 250 List of rules that exist to regulate
OECD principles, ASX principles and the FRC code, principles approach creates a
Regulation (Principle-based) 3 151 broad guideline, it is up to the company to apply it.
US Sarbanes-Oxley Act. This approach gives very specific instructions and must be
Regulation (Rules-based) 3 151 complied with.
Regulation of member conduct 1 20 -
Regulators - objectives of regulation 3 150 -
Regulatory disclosures around climate change 5 330 -
Regulatory structure CPA Australia 1 15 list in SG 31
Related party transactions 2 64 can compromise objectivity, because of a lack of independence.
Relationship-based system 3 163 European approaches, insider system, stakeholder system
Relationship-based systems 3 163 Continental Europe (e.g. Germany, France), Asia (e.g. Japan, China)
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Relationship-based systems - Asian approach 3 166 China, Japan
Relationships and roles (accounting) 1 24 -
Relativism 2 104
Relevant market 4 252 Re Mergers and acquisitions
Removal of whole board by shareholders (Australia): shareholder in public Co. can

remove director voting at general meeting before thier term has experied. condition-
Removal of directors 4 213 shareholder holding 5% of issued capital or 100 small shareholder acting together.
Remuneration 3 134 Risk avoidance (residual loss)
Remuneration - CG failure factor 4 210 One of the common CG failure factor
Remuneration and performance 4 218 du Plessis, J. (2012) Chairman of Rio Tinto -"spiral" 'Simply cannot continue"
Remuneration committee 3 147 -
Remuneration components 4 221 Fixed' and 'At-risk'
Remuneration- headline illustration 4 219 Example 4.2
Remuneration report diclosure 4 222 -
Remuneration systems (Good) 4 223 Example 4.4 BHP Billiton
Remuneration, risk and the GFC 4 223 -
Reporting and guidelines 5 330 -
Reporting with integrity 2 85 -
Representation 4 277 Concerned about the degree to which shareholders are represented.
Example of vertical power, occurs when a supplier stipulates that the goods it provides
must only be resold at or above a certain minimum price. Requires complainant to
prove on the balance of probabilities that the behaviour has occurred. #TEST: 1.
Resale price maintenance (Vertical power) 4 256 Has a minimum price been specified? 2.Has action been taken to inforce this?
Research and advisory firms (Shareholder representation) 4 278 -
Agent is not the principal and will not act in the same way and will not reach the same
outcome as the principle. So, as the agent does not achieve what would have been
Residual loss - borne by principle 3 134 achieved by the principal, this is termed as residual loss.
Organisations, public or private, earn their right to operate withing the community. This
Responsibilites of org (Alternative views) 5 306 right is given by the society.
Responsible decision making model 1 3 -
market based systems- force more institutional shareholders to practise 'responsible
Responsible investing 3 162 investing' and more engaged
Responsible investing 5 303 Avoid investment in tobacco, nuclear power, intensive fossil fuel usage, gambling, etc.
Restoring credibility to accounting 1 36 -
It sanctions corporate self-interest, encourages competition, leads to maximisation of
utility and is in the interests of society as a whole. # self-interest but not breaking the
Restricted egoism 2 54 law.
RIAA (Responsible Investment Association Australia) 5 299 Survey shows there're more responsible investment.
Richter (2012) 4 274 Bribery
Rights theory 2 56 A right is an entitlement, duty is an obligation
Rights theory (Limitations) 2 57 inability to adress conflicting rights and obligations.
Rio de Janeiro, June 1992 5 355 Climate change
Rio Tinto (2014) 5 315 Question 5.5: Rio Tinto stakeholders view report
Risk (Accountants) 3 140 Accountant spend too much time on conformance and compliance based work
Risk avoidance (Residual loss) 3 134 Examples of residual loss
Risk management - definition 4 229 by Standards Australia (2004)
Risk management - improve CG 4 229 -
Risk management committee 3 150 -
Risk management incentives 5 301 Incentives for CSR
Robert Tricker 3 140 see "Tricker 1984, p.7"
Robson and Cooper 1990, p379 1 6 Enlightened interest
Roel van Veggel-The sweet sounds of success 1 30 Reading 1.2
Board is not a place to run the business itself. See "AWA Ltd v. Daniels (1992) 10
Rogers C J 3 130 ACLC933"
Rogue trading 4 275 -
Role of IIC (institutional investor committee) 4 279 no longer valid as FRC stewardship FRC2012 gives relevan rules and principle
Role of markets 4 265
Table 1.4 showing areas of work and type of roles within public practice work
Roles in public practice 1 26 environments
Roman law 3 164 Relationship based systems - European approaches
Royal Commission on the Pike River Coal Mine Tragedy (2012) 4 247 Example 4.8: Pike River Coal Mine
US Sarbanes-Oxley Act (2002), Dodd-Frank Wall Street and Consumer Protection Act
Rule-based regulation 3 151 (2010)
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Runs (Market manipulation) 4 272 -
S
S. Moran 2012 4 270 insider trading
‘a distinguishing mark of the accountancy profession is its acceptance of the
S111 (Integrity) 2 63 responsibility to act in the public interest’
S112 (Objectivitiy) 2 64 -
List of criteria to protect directors acting properly. Also called "business judgement
Safe harbour rule in Australia 3 124 rule"
Safegaurd (Intimidation) 2 70 -
A confidential procedure that allows individuals to report incedents of unethical
Safegaurd (threats to fundamental pronciples) 2 73 behavoiour.
Safegaurds 2 73 -
Safegaurds (Contingent and referrals fees) 2 78 -
Safeguards (Financial interest) 2 78 S 240
Safeguards (Potential conflicts of intetest) 2 75 s210, s310
Safeguards (Professional fees) 2 78 Self-interest if fees too low
Saravanamuthu, K. (2004) 1 6 Ideals of Accounting-Entrepreneurialism…
All US listed companies must have an audit committee. The commitee must comprise
only independent directors and must be the principal communication conduit between
Sarbanes-Oxley Act (Audit committee) 3 148 the Company and the external auditor.
Requirements that all members of the audit committee must be independent at all
Sarbanes-Oxley Act (Audit committee) 3 148 times according to strict criteria.
Sarbanes-Oxley Act (Development) 3 161 Measures introduced - Audit reform & Corporate accountability
S404 - specifies that annual reports lodged with the SEC must state management's
responsibility for establishing and maintaining an adequate internal control structure
and procedures for financial reporting; also an assessment of the effectiveness of
Sarbanes-Oxley Act (Internal controls) 3 161 internal control structure
Provides for whistleblower protection where an employee of a listed company 'blows
the whistle' to an external entity, such as a government body, or within the corporation
Sarbanes-Oxley Act (Whistleblower) 4 284 in relation to fraud against shareholders
Crimial prosecutions can also occur under the Corp Act against who abuse
Sarbanes-Oxley Act (Whitleblower) 4 285 whistleblower protection law.
Re Wilful blindness - aim to prevent this type of approach by requiring the CEO and
CFO to sign off on the financial accounts and certify the appropriateness of internal
Sarbanes-Oxley Act (Wilful blindess) 4 210 controls
Sarbanes-Oxley Act US Congress (2002) 3 151 All US listed companies must have an audit committee
Sarbanes-Oxley Act US Congress (2002) 3 151 Principles-based vs. rules-based regulation
Satyam Computer Services 3 168 Major fraud in India
Scepticism 2 43 Possibility of raising questions
Schein (2004) 2 101 Six areas in which management decisions are most relevant
Schön (1983 p.17) 1 16 expresses Major difference in professional judgement
also stated that professionals are required to develop competency in professional
Schön 1983 1 16 judgement, artistry and intuition
SEC 2013a, ‘SEC charges former KPMG partner & friend with insider
trading’ 2 67 Case Study 2.1: Scott London
SEC 2013b, ‘US SEC Administrative Proceeding Order Re: Scott London 2 67 Case Study 2.1: Scott London
SEC requirment on renumeration 4 220
Second opnions (s. 230) 2 87 -
Securities Commission Malaysia (2012) 4 217 Board should disclose their gender diversity policies and target in annual report.
Seki and Clarke 2013 4 283 Expanding ethics - 'Whose interests should be served?'
Self interest 1 6 Acting in a way that focuses on your own benefits (not the same as selfish)
Self regulation 1 9 -
Self-interest threat 2 69 -
Self-review threat 2 69 -
Self-seeking agent 3 134 Risk avoidance (residual loss)
Service ideal 1 9 Professions exist primarily to servce socity, and this view persists today.
An ideal of service to the community, Professions exist to service society (not to
Service ideal 1 11 establish monopoly power). More on p13. refer wilensky 1964
Service ideal perspective 1 13 The will being of the society+ the pursuit of excellence+ community service
Shareholder activism 3 158 CalPERS
Shareholder model vs. Stakeholder model 3 152 The difference is largely theoretical in global corporate world
An organisation that focuses primarily on the interests of shareholders is considered to
Shareholder primacy perspective 5 306 be embracing a 'SPP' of operations
Shareholder primacy vs. Social contract 5 306 Table 5.1. Prof. Adolf Berle vs Prof. Merrick Dodd
Shareholder representations 4 278 Table 4.6
Shareholder rights 4 278 Are guaranteed by specific legislative provisions
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Shareholders 3 129 components of corporate governance
want companies to be run efficiently and profitably. Also, wants honesty from directors
Shareholders (Individual) 3 142 and managers.
Include insurance companies, pension funds, investments trusts and professional
Shareholders (Institutional) 3 142 investment fund managers.
cleary defined in law: *change constitution *appoint and remove director. * approve
Shareholders (Powers) 3 129 directors' remuneration
Shareholders' rights (OECD Principle 2) 3 172 OECD Core principle 2 (A)
Shell (Shell International Ltd) (2003) 4 274 Example 4.30: Royal Dutch Shell-Bribery allegations
Sherron Watkins 4 286 Example 4.35: Sherron Watkins (Enron)
Sikka 2009, p.868 1 35 poor audit quality - observed that...
lack of auditor independence - perrenial view on basic audting model, according to

Sikka's view, auditors will not give objective independent professional judgement
Sikka, Filling and Liew (2009) 1 35 because their incomes depend on the survival of the audit 'target'
Simha & Cullen (2012) 2 101 -
Simpson, R. W. (2002) 2 95 AA greatest foe was not the courts, but market forces and public perceptions
Sims and Brinkmann (2003) 2 102 Examining Ethical failures
Sir Adrian Cadbury 3 187 Corporate governance for family-owned firms has been the focus of the paper by
has stated that there must be a 'series of checks and balances' and the freedom to
delegate broadly is implicitly limited by the system of checks and balances. (Boards
Sir Adrian Cadbury (CFACG 1992) 3 133 need to carefully consider all delegations.)
Financial capital, Manufacturing capital, Human capital, Social and relationship
'Six capitals concept' 5 325 capital, Intellectual capital, Natural capital.
Skeet (2015) 3 155 examines the tension between the board and management
Skills of goverance 3 138
Small and medium-sized enterprises (SMEs) 3 187 Often family-owned
SME (Defined by IFAC) 1 28 -
Smith 2012 4 267 David Jones example, market manipulation event. Example 4.21
Social and envirionmental performance 5 300 can affect an organisations future reputation.
Social Audits 5 347
Society grants professions monopoly power as long as they use it in the public
Social contract 1 9 interest. If this trust is breached the social contract is broken.
Social contract 5 315 The community licence to operate
Who embraced the view that organisations survive to the extent that they comply with
Social Contract (Shareholder primacy vs Social contract) T5.1 5 306 the Social contract negotiated between the organisation and society. Table 5.1
organisations that exist to fulfil a mission consistent with public or
Social enterprises 5 323 community benefit
Social impact example—depreciation and behaviour 1 32 -
Social impact of accounting 1 32 -
Social licence to operate 5 315 -
Social procurement 5 335 Another example of social impacts inflence government decision-making.
It's A component of sustainability reporting. is the process of acknowledging an

Social reporting 5 326 organisation's social impact the positive and negative aspects of its performance.
Social return on investment (SROI) 5 327 Example 5.6: Social return on investment (SROI)
Ability of a system to continue to function at a reasonable level of social well being.
Socai Sustainablity issues includes * Child labour *Ethical Trading * Supply chain
Social Sustainability (defination) 5 320 management.
Social sustainability ability of a system to continue to function at a reasonable level of
Social well-being 5 320 social well being
Socially responsible investments (SRI) 5 302 Figure 5.5 A sprectrum of capital options
Societal factors 2 104 influence decision making
Society (Stakeholder) 3 153 Table 3.3 Nature of the corporation and some stakeholder relationships
Soft skills, knoweldge and experience 1 38 SSKE
Soft-dollar benefits 2 78 -
Solomon Ash, Stanley milgram and Philip Zimbardo 2 101 organizational factors
Sophisticated investors 4 272 Fundraising documents
Sound regulatory system 3 150
Sprectrum of capital options 5 303 Traditional investment> 1.Responsible >2. Sustainable> 3.Thematic >4. Impact
SSKE (List of abilities) 1 38 -
Stability of the economic system 5 321 GFC (Economic sustainability issues)
Staggered voting 4 211 Three year 'staggered vote' cycle for directors
Anglo-American corporation law approach is that the directors must act in the best
Stakeholder concept 3 152 interest of the corporation as a whole.
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Stakeholder map 3 152 Figure 3.5 stakeholder map (a list of potential stakeholders)
Stakeholder model 3 174 OECD Principle 4
Stakeholder relationships 3 153 Table 3.3
Stakeholder rights 3 174 OECD Principle 4
Under ST, an organisation may be viewed as being involved in contracts, some
Stakeholder theory 3 152 written, some not, and others that are in the form of 'social contracts'
first articulated 1984 by Freeman. Two branch- 1. Normative 2. Managerial.
Stakeholder theory 5 314 Stakeholder theory suggests the corporation is a nexus of relationships,
Stakeholder theory issues 3 154
Stakeholders (Employees) 3 154 -
Stakeholders (Suppliers and lenders) 3 154 See page for Table on 'Areas for consideration'
Stakeholders (who are stakeholders) 5 314 A party that is affected by, or has an effect upon, the organisation in question
More companies are producing stand-alone or web-based CSR reports over the last
Stand-alone report 5 352 ten years.
Standard setting 1 19 Quality assurance process
Standards Australia (2004) 4 229 defined risk management
Statement Principles (ISC 2007) 4 279 Sets out best practice for institutional shareholders
Stewardship theory 3 130 Directors as "stewards" ... expected to naturally act favourable on behalf of the owners
assumptions that 'good stewards' will in fact initially exist and further, that these
Stewardship theory (Criticism) 3 132 stewards will maintain their vitures over extended periods of time
financial market, Two basic corp. governance observations, 1. Shareholders require a

Stock exchange / market (corp governance) 4 265 satisfactory return 2. Managers need to ensure that corporations perform well.
Strangth of shared governance 3 156 see Author "Skeet 2015".
Strategies to increase profits 4 250 lower prices, better products or greater levels of service
Strikes 4 247 refusing to work
Strikes (Steps)/ spill the board 4 214 'Two-strike' rule
Supervisory board 3 131 Relationship based systems - European approaches
Suppliers (Stakeholder) 3 154 Table 3.6 Nature of the corporation and some stakeholder relationships
Suppliers and lenders (Stakeholders) 3 154 Table 3.4
Supply chain MGT (Social sustainability issues) 5 321 -
Sustainability (Definition) 5 325 -
Sustainability Accounting Standards Board (SASB) 5 346 A US NFP to listed co meet SEC sustainability disclosure requirements
Sustainability distribution 2 48 Mentioned in Example 2.3. as part of Stakeholder theory explanation
Sustainability reporting (Definition) 5 325 -
Sustainability reporting or CSR 5 325 Is evidenced by CSR or Sustainability Reporting.
Sustainable development - definition 5 293 The needs of today vs. compromise future generations (also: Brundtland Report)
Sustainable investment 5 303 Shareholder activism
Swiss Federal Council 4 220 Say on pay- escessive executive remuneration
System of Quality control (Elements) 1 19 APES320 Quality Control for Firms
Systematic process 2 45 ethics need to have systematic process
T
Technical skills, knowledge and experience 1 37 TSKE
Teleological theories (Benefits) 2 52 include pleasure, health, life, satisfaction, knowledge, and happiness
Determine the right from wrong or good from bad, based solely on the RESULTS or
Teleological theories (Consequential) (Relativism) 2 52 CONSEQUENCES of the decision or action.
Teleological theories (Costs) 2 52 include pain, sickness, death, dissatisfaction, ignorance and unhappiness
Teleological theories (Trad. approaches) 2 53 Egoism and Utilitarianism
Test of unconscionable conduct 4 262 -
The board - role 3 119 statute or case law
The corporation and financial markets 4 265 -
The economy and the legal system 4 238 -
The existence of a governing body 1 17 -
The Hindu (2011) 3 168 Major fraud in India
The legal system 4 237 Anglo-American, 'common law jurisdictions' refer page for countries
The public interest—ethics in practice 2 61 International Federation of Accountants (IFAC) (2010)
Standard setting, Conformity with standards, Practice reviewa, Accounting firm
The quality assurance process 1 19 regulation
The World trade organisations (WTO) 5 322 focus mainly on economic sustainability
Thematic investment 5 304 Where commercial opportunities are created from social needs
Third-line forcing (exclusive dealing) 4 256 is 'Per se illegal' - Simply not allowed. Example 4.15: Hypothetical-Tummy Fill
Threats 2 69 -
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Threats (Examples) 2 70 Table 2.4
Threats to fundamental principles 2 69 Table 2.5
Three E's 3 191 Three E's economy, Efficiency and effectiveness - by IntOSAI
Three pillars of sustainable development 5 322 Figure 5.1. * Social, * Enviromental, * Economic
Tightening rules regarding remuneration-Australian illustrations 4 223 Leyden, F. (2008)
Top concerns about charities (fraud) 4 233 Figure 4.2 (pie chart)
Top tier management 2 101 most influential factor in setting organisational values
Trade Practices Commission (1991) 4 261 Misleading conducts and representations / Puffery
also known as labour union or just a union, Commonly seek to achieve outcomes
Trade union 4 247 through collective bargaining with employers.
Traditional financial reporting 5 294 -
Traditional view and Functional view of professionalism. #Serves the public interest
#A person has significant level of training and high level of competence. #Behave in
Traditional View 1 11 ethical and appropriate manner.
Traits of a sound regulatory system 3 150 -
refers to openness and authenticity about the corp operations and strategy.
Transparency allows external stakeholders to appreciate the exposure of corporations
Transparency (Economic sustainability issues) 5 322 to risks.
Transparent disclosure (OECD Principle 5) 3 174 crucial to ensure continuity of supply the finance
Transparent report 5 301 Reducing risk is an additional economic incentive for transparent report.
"Management is about running the business; governance is about seeing that it run
Tricker 1984 p.7 (i.e. Robert Tricker) 3 140 properly."
Tricker model,Tricker framework (2012) F3.3 3 145 Board's responsibilities and functions
Trust and professions 1 12
Tsahuridu 2011, p. 56 2 100 Whisteblowing, example 2.11
TSKE (Relevant) 1 37 Refer for list
TSKE and SSKE—career perspectives 1 38 -
Two-Strikes rule 4 214 Note 1, departures of directors
Two-tier / Dual board structure 3 131 E.g. Germany and China to have employees on lower-tier board
Two-tier board structure (Countries) 3 131 Germany, France, Japan, China (not in South Korea)
North Europe: top tier-supervisory board + second tier-mangement board (strong

Two-tierd board structure 3 131 employee representation) // In Japan have banks on board to get stable financing
Types of corporations 3 116 Table 3.1
U
listed factors for ineffective CG in public sector, and recommended best practice
Uhrig (2003) 3 191 approaches
Uhrig Report 3 191 learn benefits from private sector when considering CG for public sector
UK Bribery Act 2010 4 274 All UK-based co are in breach of UK law if paying bribe, anywhere in the world.
UK Financial Reporting Council Corporate Governance Code (FRC 2014) 3 176 Five main principles in detail
UK FRC (2012b) 4 279 The representation role of institutional investors
UK FRC CGC 3 197 Appendix 3.1
UK FRC Code - Section B 3 125 Factors to help consider whether a directors is independent
Insititutional investors should have a clear policy on voting and disclosure of voting
UK Stewardship Code (FRC 2012) 3 197 activity.
UN Convention Against Corruption 4 274 Demonstrated increased global awarenss of bribery.
Unconscionable conduct 4 261 Courts may consider additional rules
customers (Individuals and business consumers), suppliers, lenders and borrowers
Unconscionable conduct (Stakeholders protected) / tests/ complaints 4 262 Example 4.20: Amadio case
UNCTAD 2006 3 122 Quality of financial disclosure
UNEP (United Nations Environmental Programme) 5 322 focus mainly on economic sustainability
UNFCCC 5 355 United Nations Framework Covention on Climate Change
Unhappiness (Egoist theory) 2 54 pain, sadness, frustration
Unilateral restrictions on supply (exclusive dealing) 4 255 -
Firmly believe that social responsibility and minimising environmental impacts are
Unilever 5 308 essential
Unitary board 3 164 Relationship based systems - European approaches
United Nations Global Compact 5 343 -
UPI (United Press International) report (2012) 4 268 EU gives proposed regulatory controls over rating agencies.
US Congress 2002, s806 4 284 Sarbanes-Oxley Act, Whistleblower
Utilitarian analysis (Limitations) 2 54 Subject to four main limitations
is attractive because of its simplicitiy and its systematic approach to problem
Utilitarian principle 2 54 resolution
Utilitarian principle (Five steps) 2 54 -
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Utilitarianism 2 54 an act or decision that produces the greatest benefit for the greatest number of people
V
Variables (That impact on an accountant) 1 24 -
Verrecchia 1983, Healy & Palepu 1993 5 302 Voluntary disclosure theory - increase investors' trust, so lower cost of capital
Example of vertical power, occurs when a supplier stipulates that the goods it provides
must only be resold at or above a certain minimum price. Requires complainant to
Vertical power (resale price maintenance) 4 256 prove on the balance of probabilities that the behaviour has occurred.
A manufacturer setting up a minimum price to retailers is a vertical price control, a
Vertical price 4 256 form of resale price maintenance.
Victims of wrongs (Potential) 4 240 -
Virtue ethics 2 58 focus is to understand and develop virtues that make us better people.
does not always provide guidance when a person is faced with genuine ethical
Virtue ethics (Limitations) 2 58 dilemma. # It focuses on consequences and ignores moral duties.
Attitudes, dispositions or traits of character that enable us to do what is ethically
Virtues (Defined) 2 58 desirable, which eventually becomes an habitual acttio
courage, courtesy, compassion, generosity, fairness, fidelity, friendliness, honesty,
Virtues (example) 2 58 integrity, prudence, and self-control)
Vision 2050 (WBCSD 2009) 5 299 nine billion people to live without exhausting the natural capitals of the world
Visy Industries Holding 4 253 Market sharing and price fixing
argues that a consequence of the enhanced disclosures is that investors trust and
Voluntary disclosure theory 5 302 confidence are increased.
W
Wage gap between CEOs and entry level grads 4 220 Table 4.1
WBCSD 5 299 environmental issues have impact on company's profitability
WCED (World Commission on Environment and Development) (1987) 5 314 The needs of today vs. compromise future generations (also: Brundtland Report)
idnetified a number of distinctions amount Euopean countries (political, legal and
Weil, Gotshal & Manges 2002, pp.3-5 3 164 regulatory)
Well-being of society 1 13 -
Wen (2013) 4 215 Newspaper report. Example 4.1: Reaction to shareholder spills
Re professional judgement - suggests that without a judgement, accounting becomes
nothing more than a book of rules for compliance or an occupational group that
West (2003, p. 195) 1 17 depends upon the imposition of 'regulatory fiat'
Pointed out that images of altruism, ethical service and self regulation were
supplanted by a portrayal of preofessions of self interested collectives. Professions -
West (2003,p.21) 1 3 The 'market control' view. Also in Pg. 11)
What does ethics mean to you? 2 44 Survey to business people
Oxford dictionary : Defined as an occupational area or vocation that 'involves
What is a profession? 1 8 prolonged training and formal qualification'. Greenwood, E. (1957)
What is a professional? 1 8 -
What is required? (Mandatory reporting) 5 330 -
* ASIC, *External Auditor or member of the external auditing team. *Director/
Whistleblower are only permitted to inform 4 285 secretary/ senior manager. *Corp counsel / Internal auditor.
can be defined as the 'disclosure by organisation members (former or current) of
illegal, immoral or illegitimate practices under the control of their employers, to
persons or orgnisations that may be able to effect action. Example 4.17: National
Australia Bank-dealing room failure (Rogue trading). Protects from retaliation and civil
Whistleblower protection 4 283 rights are made to the employee
Example 2.8, managers view as risk generator rather than an element of the risk
Whistleblowing- example 2 100 management infrastructure'
referred to the importance of the 'service ideal', which he conisdered to be 'the pivot
Wilesnky (1964, p140) 1 13 around which the moral claim to professional status revolves'
Wilful blindness / ignorance 4 210 Term referred to under US legislation
Willmott 1990, p315 1 13 service ideal (the efficient and effective use of society's resources)
Windal (1990, p. 26) 2 63 ‘integrity is an element of character and is essential to the maintenance of public trust’
Corruption is a problem that all countries have to confront. Solutions, however, can
Wolfensohn, James D., World Bank President 1996 4 273 only be home-grown.
wrok to rule: workers performing their duties with over attention to strict detail
compared to normal workplace practice, causing deliberate difficulties for employers.
(If bargaining process fail then indestrial action may occur - *go slows, work to rule, or
Work to rule 4 247 strickes.)
Workable competition (Effective competition) 4 248 Requirements listed on page
Working definition (Market manipulation) 4 272 Churning, pools, runs, fundrising documents
World Vision (2012) 5 321 Social sustainability: child labour
WorldCom 1 11 in the period.
WWF (World Wildlife Fund) (2014) 5 320 Environmental sustainability: biodiversity
Y
In Japan, board members are insiders leading management, not outside representing
Yasui 1999, p.4 3 167 shareholders.
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CPA Ethics and Governance Exam Index

Comparative Corporate Governance Structures (Murdoch University)

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North Europe: top tier-supervisory board + second tier-mangement board (strong

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Re excessive remuneration - Bypassing this legislative approach, French corporations

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Diversity - Fairness and Performance. Norway,France, Spain introduced mandatory

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Diversity - Fairness and Performance. Norway,France, Spain introduced mandatory

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−Automatic −By order of a court. - prescibed by regulatory agencies (ASIC) or APRA

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shall not knowingly be associated with reports, returns, communications or other

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Mitigation 5 355 UNFCCC established an institutional framework - to reduce emissions - mitigation

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Monopolists become complacent(meaning satisfied) and do not keep up with latest

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# comprises conduct that is legal, objective, competent, ethical, responsible,

encompasses the pursuit of excellence (including integrity, objectivity, independence,

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Removal of whole board by shareholders (Australia): shareholder in public Co. can

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